Futures trading suggests that the two-day market rally may be faltering as traders take a breather and settle into economic fundamentals.
On Tuesday, the US major averages opened significantly higher. Consolidating gains over the sessions, each of them closed up 2.8% or more.
| index | Performance (+/-) | value | |
|---|---|---|---|
| Nasdaq Composite | +3.34% | 11.176.41 | |
| S&P 500 Index | +3.06% | 3,790.93 | |
| Dow Industrials | +2.80% | 30,316.32 |
The S&P 500’s 3.06% gain was its best one-day gain since May 2020. The key moving averages are now at 2-week highs thanks to stellar gains over the past two sessions. The catalyst driving the recent rally is an expected dovish stance from the Fed amid recent weak economic data.
Not everyone is convinced that the rally is stable. Iy is a welcome change but does not indicate a “fundamental shift in the underlying economic forces that have dominated sentiment so far”. Daniel Berkowitz, Senior Investment Officer at Prudent Management Associates.
Berkowitz didn’t rule out disappointment during the quarter. The analyst sees the upcoming Q3 earnings season, Q3 GDP data due in October and mid-term elections as key data points that could bring some clarity to the near-to-medium-term outlook.
| index | Performance (+/-) | |
|---|---|---|
| Nasdaq 100 futures | -0.90% | |
| S&P 500 futures | -0.91% | |
| Dow futures | -0.94% | |
| R2K futures | -1.32% |
In premarket trading on Wednesday, Dec SPDR S&P 500 ETF TrustSPY fell 0.95% to $374.38 and Invesco QQQ Trust QQQ down 0.87% to $279.68 Benzinga Pro data.
On the economic front, traders can digest ADP’s US personal payroll report for September, due at 8:15 am EDT. Economists expect that sector to…
