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Stock-index futures edged higher Wednesday as investors prepared for a second day of testimony from Federal Reserve Chairman Jerome Powell, after his remarks before a Senate panel were credited with helping major benchmarks trim or erase big intraday losses.
What are major benchmarks doing?
- Futures on the Dow Jones Industrial Average YM00, +0.18% were up 55 points, or 0.2%, at 31,547.
- S&P 500 futures ES00, +0.40% rose 10.85 points, or 0.3%, to 3,888.75.
- Nasdaq-100 futures NQ00, +0.71% advanced 46.50 points, or 0.4%, to 13,238.50.
The Dow DJIA, +0.05% on Tuesday erased a loss of more than 360 points to eke out a positive finish, while the S&P 500 SPX, +0.13% snapped a five-day losing streak and the Nasdaq Composite COMP, -0.50% trimmed a loss of nearly 4% to end the session only 0.5% lower.
What’s driving the market?
In his remarks, Powell said the economy remained far off the Fed’s employment and inflation goals, giving no indication a recent rise in bond yields would prompt the central bank to begin tapering its asset-buying program. Fears the Fed could move to scale back stimulus sooner than anticipated had been blamed for the stock market’s late February wobble, which hit highflying, tech-oriented and growth shares hardest, while stocks more sensitive to the economic cycle benefited.
Read: Here are 3 reasons why the stock market can survive rising bond yields in 2021
“Powell gave another market-friendly speech, maintaining a highly accommodative stance, almost welcoming the move higher in US bond yields as they ‘reflect more confidence in the economy’ and seemed unperturbed by the frothy conditions in financial markets,” said Chris Weston, head of research at Pepperstone, in a note.
“His views on future asset purchases supported risk, suggesting he wanted to see ‘substantial progress’ before tapering,” Weston said.
Powell will deliver a second day of testimony, this time to a House panel, beginning at 10 a.m. Eastern. Other Fed officials set to make public remarks Wednesday include Gov. Lael Brainard, who will give a guest lecture at Harvard at 10:30 a.m., and Vice Chair Richard Clarida, who will deliver a speech on the economy to the U.S. Chamber of Commerce at 1 p.m.
Data on January home sales is due at 10 a.m. Eastern.
Which companies are in focus?
- Shares of Square Inc. SQ, -4.29% were down 2.6% in premarket trade after the company late Tuesday said surging interest in bitcoin and equities trading among Cash App customers helped more than double revenue for its latest quarter. The company also doubled down on its own interest in bitcoin by announcing a new $170 million purchase of the cryptocurrency.
- Intuit Inc. INTU, -0.61% shares were down 2% after the financial-services company reported fiscal second-quarter results late Tuesday.
- Shares of aluminum-products maker Arconic Corp. ARNC, -11.27% rose 1.4% after it reported a surprise fourth-quarter loss late Tuesday but delivered revenues that were above forecasts.
- Lowe’s Cos. LOW, -2.22% shares were up 0.7% after the home improvement retailer delivered fiscal fourth-quarter profit and sales that topped expectations, and said it planned to buy back $9 billion worth of its stock this year.
- Shares of Casper Sleep Inc. CSPR, -1.56% jumped 4% after the mattress company reported fourth-quarter revenue that beat expectations, and a narrower-than-expected losses.
- Bausch Health Cos. Inc. BHC, -0.19% shares rose nearly 3% after the pharmaceuticals and medical devices company said it reached an agreement with billionaire activist investor Carl Icahn to add two of his nominees to its board of directors.
- Six Flags Entertainment Corp. SIX, -1.81% shares were up more than 1% after the company reported a wider-than-expected loss for the third straight quarter, but saw fourth-quarter revenue fell less than expected as those who did attend the company’s theme parks spent more than forecast.
- Exxon Mobil Corp. XOM, +1.38% on Wednesday said it had agreed to sell most of its non-operated upstream assets in the U.K. central and northern North Sea to HitecVision for more than $1 billion.
How are other markets performing?
- The yield on the 10-year Treasury note TMUBMUSD10Y, 1.379% edged up nearly 3 basis points to 1.377%. Yields and bond prices move in opposite directions.
- The ICE U.S. Dollar Index, DXY, -0.05% a measure of the currency against a basket of six major rivals, ticked down 0.1%.
- Oil futures were higher, with the U.S. benchmark CL.1, +1.01% up 1.1% at $62.33 a barrel. April Brent BRNJ21, +1.18% rose 1.2% to trade near $66.14. April gold futures GCJ21, +0.02% ticked up 0.1% at $1,807.70 an ounce.
- In overseas stock trading, the pan-European Stoxx 600 SXXP, +0.52% dropped 0.5% and London’s FTSE 100 UKX, +0.28% gained 0.4%. The Shanghai Composite SHCOMP, -1.99% fell 2%, while Hong Kong’s Hang Seng Index HSI, -2.99% slumped 3%.
