Stock Futures – Stock futures open slightly higher after strong market rally on Monday
US stock futures opened slightly higher Monday night after the Dow Jones Industrial Average posted its best day since March.
The indices recovered some of last week’s heavy losses when the Federal Reserve’s updated projections for inflation indicated a sell-off. Commodities stocks such as Devon Energy and Occidental Petroleum led the market return on Monday after being hit hard last week. Norwegian Cruise Line and Boeing shares rose more than 3% as the economy continues to reopen.
“Stocks rallied strongly on Monday, although all the S&P did was recover from their decline on Friday,” according to Vital Knowledge’s Adam Crisafulli. “Cyclical stocks may have rallied on Monday, but they are still in a downtrend and investors should use the rallies to post gains.”
Federal Reserve Chairman Jerome Powell will testify before the House of Representatives on Tuesday about the central bank’s response to the pandemic. His comments, released ahead of Monday night’s hearing, are likely to support the idea that the Fed is ready to soon begin discussing removing some of its unprecedented stimulus measures enacted during the pandemic.
“Since the last meeting, the economy has shown sustained improvement,” Powell will say Tuesday, according to the Fed statement. “Widespread vaccinations have joined unprecedented fiscal and monetary policy actions to provide strong support for the Economic activity and employment indicators have continued to strengthen, and this year’s real GDP appears to be on track to record its fastest rate of increase in decades. “
“Inflation has risen markedly in recent months,” Powell will say. But the Fed chief will note that most of them are a temporary effect and that inflation should return to 2% in the long run.
On Tuesday morning, the Federal Reserve Bank of Philadelphia will release its non-manufacturing business data, the National Association of Realtors will release existing home sales data for May, and the Federal Reserve Bank of Richmond will release the results of its monthly Manufacturing Activity Survey.