Wall Street could struggle to keep up with a strong session as futures fell on Wednesday as investors watched bond yields rise and wait for more corporate results, including Tesla, after the market closed.
How are stock index futures traded?
Dow Jones Industrial Average YM00 futures contracts,
were stable at 35,319
S&P 500 ES00 Futures,
were slightly less than 4510
Nasdaq-100 NQ00 Futures,
fell almost 0.1% to 15,386
Tuesday, the Dow Jones Industrial Average DJIA,
increased 199 points, or 0.56%, to 35,457, the S&P 500 SPX,
rose 33 points, or 0.74%, to 4,520, and the Nasdaq Composite COMP,
gained 107 points, or 0.71%, to 15,129.
What drives the market?
A winning streak that led the S&P 500 and Nasdaq Composite to five consecutive positive sessions looked poised for a break. The S&P 500 is also at 0.38% of its all-time high reached on September 2 at 4,536.95.
So far, investors have pushed markets higher on positive corporate earnings, while juggling concerns about supply chain disruptions and potential impacts on profit margins are not far off.
Fundstrat Global Advisors raised its year-end forecast of the S&P 500 to 4,800 from 4,700. In a note to clients, strategists led by founder Tom Lee said they saw a “high risk environment” in the future. price, helped by a generally strong seasonal trend at the end of the year following October.
A busy results schedule is ahead, with electric car maker Tesla TSLA,
is expected to report after Wednesday’s close, while biotech Biogen BIIB,
Abbott Laboratories ABT medical devices and healthcare group,
Baker Hughes BKR oil services group,
and the telecommunications group Verizon Communications VZ,
are among the names that report before opening.
Tech stocks looked to be under some pressure as the 10-year US Treasury yield TMUBMUSD10Y,
hovered around a five-month high of 1.6409%. Yields climbed Tuesday after Federal Reserve Governor Christopher Waller said the central bank should start cutting its $ 120 billion monthly purchases of treasury bills and mortgage-related assets from the month next.
The Fed’s beige book on economic conditions, due Wednesday at 2 p.m. EST, will be one to watch, said Steen Jakobsen, chief investment officer of Saxo Bank. In a note to clients, he said investors should pay close attention to what the report says “on the demand versus the available supply of labor and parts, as well as the ‘state of supply chains and logistics’.
Which companies are targeted?
Actions of Netflix Inc.
fell 1.9% in pre-market trade. The video streaming company reported a rebound in revenue and subscribers in the third quarter, but slightly disappointing forecasts for the fourth quarter.
Actions of Novavax inc.
slipped 17% in pre-market trade. Citing sources, Politico reported on Tuesday that the biotech group faces big hurdles to prove it can produce a COVID vaccine that meets regulatory standards.