The major U.S. index futures on the Dow Jones, S&P and Nasdaq are currently pointing to a higher open on Tuesday, with stocks likely to regain ground following the sell-off seen in the previous session.
Traders may look to pick up stocks at reduced levels following the steep drop seen on Monday, which came amid lingering trade war concerns and President Donald Trump’s continued attacks on Federal Reserve Chair Jerome Powell.
The markets may also benefit from a positive reaction to some of the latest earnings news, with shares of 3M (NYSE:MMM) surging by 5.3 percent in pre-market trading after the manufacturing conglomerate reported better than expected first quarter results.
Aircraft engine supplier GE Aerospace (NYSE:GE) is also jumping by 4.5 percent in pre-market trading after reporting first quarter earnings that exceeded analyst estimates.
Defense contractor Lockheed Martin (NYSE:LMT) may also see initial strength after reporting first quarter results that exceeded expectations on both the top and bottom lines.
On the other hand, shares of Verizon (NYSE:VZ) are slumping by 5.3 percent in pre-market trading after the telecom giant reported better than expected first quarter earnings but lost more postpaid phone subscribers than expected.
Electric vehicle maker Tesla (NASDAQ:TSLA) is among the companies due to report their quarterly results after the close of today’s trading.
After turning in a lackluster performance to close out the previous week, stocks showed a substantial move to the downside during trading on Monday. The major averages all moved sharply lower, with the Dow adding to the steep loss posted last Thursday.
The major averages climbed off their worst levels going into the end of the day but remained firmly negative. The Nasdaq plunged 415.55 points or 2.6 percent to 15,870.90, the Dow tumbled 971.82 points or 2.5 percent to 38,170.41 and the S&P 500 slumped 124.50 points or 2.4 percent to 5,158.20.
The sell-off on Wall Street came amid lingering concerns about a global trade war as traders await signs of progress from Trump’s trade talks.
Potentially adding to the worries, China has threatened to retaliate against any countries that reach a trade deal with the U.S. at the expense of China’s interests.
A spokesman for China’s Ministry of Commerce was asked to respond to reports the Trump administration is preparing to put pressure on other countries to restrict trade with China in exchange for U.S. tariff exemptions.
“If this happens, China will never accept it and will resolutely take countermeasures in a reciprocal manner,” the spokesman responded, according to a Google translation. “China is determined and capable of safeguarding its own rights and interests.”
Trump’s continued attacks on Powell added to the negative sentiment, with the president calling him “Mr. Too Late” and “a major loser” in a post on Truth Social.
In the same post, Trump also claimed there will be “almost no inflation” but warned “there can be a SLOWING of the economy” unless Powell lowers interest rates.
Trump also called on the Fed to lower rates in a separate post last week, declaring, “Powell’s termination cannot come fast enough!”
Networking stocks showed a substantial move to the downside on the day, resulting in a 3.2 percent plunge by the NYSE Arca Networking Index.
Significant weakness was also visible among natural gas stocks amid a steep drop by the price of the commodity, dragging the NYSE Arca Natural Gas Index down by 3.0 percent.
Airline, oil service and software stocks also saw considerable weakness, moving notably lower along with most of the other major sectors.
Dow Jones, S&P, Nasdaq, Bargain Hunting, Upbeat Earnings May Lead To Strength On Wall Street
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