Nasdaq, S&P Futures Spike Higher Following Tuesday's Tentative Gains: Nike, Tesla, Micron, Housing & Consumer Confidence Data In Focus

U.S. stocks look set for a positive start on Wednesday, with the index futures trading moderately higher. Sentiment going into the session likely hinges on a couple of economic readings and energy prices.

The major averages closed Tuesday’s session slightly higher, as traders braved BoJ’s surprising policy move and another not-so-positive housing market data. Housing starts declined in November, albeit by less than expected, while building permits — an indicator of future activity — plunged.

A majority of the sectors advanced, with technology, energy and material stocks seeing strong buying interest. On the other hand, consumer discretionary, consumer staple, real estate and healthcare stocks experienced some weakness.

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In an interesting take, LPL Financial’s chief global strategist Quincy Krosby drew a parallel between the situation now and the one that prevailed in 2018. “The extreme 2018 Christmas Eve sell-off followed by a true Fed ‘pivot’ announced on January 4, 2019, has many wondering if Chairman Powell could soon deliver something similar," Krosby said.

The key fundamental difference between the two scenarios, according to the economist, is that inflation was 2.44% in 2018 and Powell’s chief goal was to normalize rates. Now, inflation remains high and the Fed’s mandate aims to achieve price stability, Krosby added.

“While Santa may surely visit in this short-term oversold market, perhaps with Friday's Personal Consumption Expenditures Index (PCE) report, or even with Thursday's continuing claims data — but don't expect a Federal Reserve pivot now, the Fed's congressionally mandated job is not yet near completion,” Crosby said.

Here’s a peek into index futures trading:

In premarket trading on Thursday, the SPDR S&P 500 ETF Trust SPY rose 0.60%, to $382.83, and the Invesco QQQ Trust QQQ gained 0.57%, to $271.08, according to Benzinga Pro data.

On the economic front, the Mortgage Bankers Association will release the mortgage applications volume data for the week ended Dec. 16 at 7 a.m. EST. The previous week saw a 3.2% week-over-week increase in the metric.

The Bureau of Economic Analysis will release its current account data for the third quarter at 8:30 a.m. EST.

The National Association Of Realtors is due to release its existing home sales data for November at 10 a.m. EST. Economists, on average, expect a decline in existing home sales from 4.43 million units in October to 4.20 million units.

Around the same time, the Conference Board will release its consumer confidence index for December. The consensus estimate calls for the index to edge up from 100.2 in November to 100.8 in December.

At 10:30 a.m. EST, the Energy Information Administration will release its oil inventory report for the week ended Dec. 16.

The Treasury will auction 20-year bonds at 1 p.m. EST.

Stocks In Focus:

• Tesla Inc. TSLA shares advanced about 2.50% in premarket trading.
• Nike Inc. NKE jumped over 12.50% following the release of better-than-expected quarterly results. Most other footwear and apparel retailers moved in sympathy.
• FedEx Corp. FDX advanced despite reporting mixed quarterly results.
• Workday Inc. WDAY slipped over 1% on an executive transition announced by the company.
• Carnival Corp. CCL, Cintas Corp. CTAS and Rite Aid Corp. RAD are among the companies scheduled to release earnings report before the market open.
• Memory chipmaker Micron Technology Inc. MU is scheduled to report after the close.

Commodities, Other Global Markets:

Crude oil futures were higher for a third straight session, with WTI crude oil adding over 1% to $77.03 a barrel. Energy stocks could extend their rally if oil holds onto its gains through the session.

The yield on the 10-year Treasury yield was little changed at 3.686%.

The Asia-Pacific markets closed Wednesday’s session on a mixed note, while European stocks have started on a firmer footing.

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