U.S. stocks are poised for a potential rebound on Tuesday after facing concerns about valuations in the previous session. Early trading shows modest gains in major index futures, indicating continued market momentum. The day’s trading direction may be influenced by retail earnings reports, economic data releases, and a scheduled Fed speech. Traders may proceed cautiously ahead of key economic catalysts expected later in the week.
With February recording solid gains, markets could be aiming to close the month on a positive note. Investor sentiment leans towards risk-taking, as reflected in rallying cryptocurrencies, with Bitcoin BTC/USD surpassing the $56,500 mark.
Monday’s Market Recap:
The market, which had been overbought, opened higher but later relinquished its gains, displaying volatility throughout the session. Monday’s subdued sentiment occurred as traders paused for a breather following the recent record highs in the broader market.
All three major indices ended the session slightly lower, although small-cap stocks, which had been underperforming, managed to buck the downtrend and finish moderately higher.
Eight of the 11 S&P 500 sector classes closed lower for the day, primarily in the communication services, utility, and real estate sectors. Information technology (IT) stocks remained largely unchanged with a slight positive bias, while the consumer discretionary and energy sectors saw modest gains.
| Index | Performance (+/-) | Value |
| Nasdaq Composite | -0.13% | 15,976.25 |
| S&P 500 Index | -0.38% | 5,069.53 |
| Dow Industrials | -0.16% | 39,069.23 |
| Russell 2000 | +0.61% | 2,028.97 |
Analyst Color:
As February is shaping up to be a strong month, an analyst pointed to historical data that augurs well for the market.
Calling it a “big takeaway,” Carson Group’s Ryan Detrick noted that the market records an average gain of 19.87% on the years when both January and February record gains.
With just three sessions to go for February to end, the S&P 500 is up 4.62%, adding onto the 1.59% gain in January.
Futures Today
Futures Performance On Tuesday ( as of 5:30 a.m. ET)
| Futures | Performance (+/-) |
| Nasdaq 100 | +0.17% |
| S&P 500 | +0.09% |
| Dow | +0.04% |
| R2K | +0.25% |
In premarket trading on Tuesday, the SPDR S&P 500 ETF Trust SPY rose 0.11% to $506.55 and the Invesco QQQ ETF QQQ rose 0.22% to $437.52, according to Benzinga Pro data.
Upcoming Economic Data:
The Commerce Department is due to release its durables goods orders report for January at 8:30 a.m. ET. Economists, on average, expect durable goods orders to dip 4.9% month-over-month, following December’s unchanged reading. Core durable goods orders excluding the volatile transportation orders, may have risen 0.2%, slower than the previous month’s 0.6% growth.
The S&P/Case-Shiller as well as the Federal House Finance Agency will release the results of their separate house price surveys for December at 9 a.m. ET. The S&P/Case-Shiller 20-city composite house price index is expected to increase a seasonally unadjusted 6% in December compared to 5.4% growth in November. FHFA’s house price index is expected to increase at a stable monthly rate of 0.3%.
Fed Vice Chair for Supervision Michael Barr is scheduled to speak at 9:05 a.m. ET.
The Conference Board is due to release its consumer confidence index for February at 10 a.m. ET, with economists, on average, estimating a reading of 115.1, up slightly from January’s 114.8.
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Stocks In Focus:
- Zoom Video Communications, Inc. ZM climbed nearly 12% in premarket trading following the company’s earnings announcement.
- Other stocks moving on earnings are CarGurus, Inc. CARG (down about 13%), Workday, Inc. WDAY (down over 7%), CAVA Group, Inc. CAVA (up about 9%) and Unity Software Inc. U (down about 15.50%).
- American Tower Corporation AMT, AutoZone, Inc. AZO, Cracker Barrel Old Country Store, Inc. CBRL, The J. M. Smucker Company SJM, Lowe’s Companies, Inc. LOW, Macy’s, Inc. M and Norwegian Cruise Line Holdings Ltd. NCLH are among the notable companies due to release their quarterly results ahead of the market open.
- Those reporting after the close include Agilent Technologies, Inc. A, Ambarella, Inc. AMBA, Beyond Meat, Inc. BYND, eBay, Inc. EBAY, Devon Energy Corp. DVN, DVN, First Solar, Inc. FSLR, Splunk, Inc. SPLK, Virgin Galactic Holdings, Inc. SPCE and Urban Outfitters, Inc. URBN.
Commodities, Bonds, Other Global Equity Markets:
Crude oil futures slipped 0.04% to $77.55 in early European session on Tuesday after rallying 1.49% on Monday. The benchmark 10-year Treasury note edged down 0.031 percentage points at 4.268%.
In Asia, Hong Kong and Chinese markets ended solidly higher, while the sentiment across the rest of the major markets was muted. European stocks held up in early trading, with Germany’s DAX leading the gains.
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