Stock futures rose on Tuesday after better-than-expected earnings from two retail giants, putting the S&P 500 on track to exceed its previous record close set in February before the coronavirus hit.
The S&P 500 closed Monday at 3,381.99, just a few points from its record close of 3386.15 set on Feb. 19 and 0.3% below its intraday record of 3393.52.
S&P 500 futures added 8.2 points, or 0.25%. Futures on the Dow Jones Industrial Average gained 0.4%. The move implied an opening gain of about 122 points. Nasdaq-100 futures added 0.4%.
Here’s what traders were watching Tuesday:
- Walmart shares shot higher by 5.5% in premarket trading. The retailer’s earnings and revenue topped Wall Street estimates last quarter as same-store sales increased by 9.3%. E-commerce sales nearly doubled.
- Home Depot shares gained 2.9% in premarket trading after the company said sales last quarter jumped 23% as consumers stuck in their homes increased do-it-yourself projects. Earnings and sales exceeded Wall Street expectations.
- U.S. housing starts for July totaled 1.496 million, easily topping an estimate of 1.24 million.
- Senate Republicans plan to introduce a narrow coronavirus relief plan that also includes $10 billion for the U.S. Postal Service, NBC News reported Monday evening.
- Tesla shares jumped 5.5% in premarket trading to $1,937. The stock is set to split 5-for-1 later this month.
The broad equity gauge has been flirting with a new all-time high since last week.
“Markets lack a catalyst to help markets overcome technical resistance,” Mark Hackett, Nationwide’s chief of investment research, said in a note. “The S&P 500 has seen its best 100-day move in history, and therefore embeds optimistic assumptions on the economic recovery and fiscal stimulus. These factors will need to surprise to the upside to drive markets materially higher.”
The S&P 500 has rallied more than 50% from its March bottom amid massive fiscal stimulus and better-than-feared earnings results. The tech-heavy Nasdaq Composite hit a new record close and intraday high during Monday’s trading, pushing its 2020 gains to 24%.
The market has been stuck in a tight range as hopes for a new coronavirus stimulus deal dimmed with lawmakers unwilling to break a stalemate. Democrats and Republicans are holding their respective presidential nominating conventions this week and next.
Meanwhile, tensions between the U.S. and China still kept investors on edge. The Trump administration announced on Monday it will further tighten restrictions on Huawei, aimed at cracking down on the Chinese telecom giant access to commercially available chips.
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