U.S. stock futures were higher on Tuesday as investors continued to be optimistic about the prospect of states re-opening the U.S. economy.
Dow futures were up 323 points, or 1.4%, and implying a positive open of about 300 points. S&P 500 futures were up 1.1% and Nasdaq futures gained 1.1%.
Shares of Pfizer, Caterpillar and 3M were all higher after first-quarter earnings results, helping sentiment.
A partial reopening of the economy — in Alaska, Georgia, South Carolina, Tennessee, Texas, and others — had earlier boosted investor sentiment, with certain U.S. businesses poised to benefit from the first wave of consumers emerging from the coronavirus driven quarantine.
On Monday, the Dow Jones Industrial Average rose more than 350 points, closing above 24,000 for the first time since April 17. The S&P 500 and Nasdaq Composite always registered a gain, advancing 1.5% and 1.1%, respectively. Monday’s gains put the S&P 500 on pace for its biggest one-month gain since 1987 with an 11.4% surge in April.
“The stock market is increasingly reflecting a restart in the economy as more and more states show a willingness to allow some economic activities to come back online,” Jim Paulsen, chief investment strategist at The Leuthold Group told CNBC. “Not only did the S&P 500 index post a healthy gain today but it was led by those segments of the marketplace which are most dependent on an economic restart including small caps, high beta stocks, and cyclical sectors like financials, materials, and industrials.”
Stocks that would benefit the most from a reopening led the market higher on Monday and were up again in Tuesday premarket trading. Shares of Wynn, Simon Property Group and Kohl’s were all higher by at least 4% after big gains on Monday.
The moves came as oil prices continued to sell-off. U.S. West Texas Intermediate crude for June delivery plunged almost 20% at one point following a more than 24% decline on Monday.
However, oil rebounded off the worst levels of the overnight session and were last down 7%.
Oil prices have come under pressure in recent weeks as concerns mount over declining storage capacity.
Bank stocks also got a boost from rising bond yields, as investors fled safer assets and moved into equities. JPMorgan rose 4.3%, Citigroup surged 8% and Wells Fargo gained 5.5%. Bank of America and Goldman Sachs rose 5.8% and 3.7%, respectively.
While many investors are bullish on the first wave of reopenings, DoubleLine CEO Jeffrey Gundlach said Monday the market could retest its March low as market participants could be underestimating the social disruptions from the coronavirus.
“I think a retest of the low is very plausible,” Gundlach said on CNBC’s “Halftime Report.” “People don’t understand the magnitude of … the social unease at least that’s going to happen when … 26 million-plus people have lost their job,” the so-call bond king added.
Investors are also digesting the busiest week of earnings season, with 145 S&P 500 companies reporting between Monday and Friday. A quarter of the way through earnings season companies have proved the coronavirus is weighing heavy on corporate profits.
Consumer confidence will be released at 10 am E.T. on Tuesday. Economists polled by Dow Jones are expecting a read of 92 in April, down from March’s read of 120.
Subscribe to CNBC PRO for exclusive insights and analysis, and live business day programming from around the world.
Dow futures rise more than 200 points as oil prices continue to fall
0 Comments: