Stock index futures were flat to slightly lower on Tuesday, indicating a smooth start for Wall Street, a day after the S&P 500 index and Nasdaq Composite hit another record round and major banks started the earnings reporting season ,
What are the main indexes doing?
Futures on the Dow Jones Industrial Average
were down 10 points or less than 0.1% to 28,861 while S&P 500 futures
lost 3 points or 0.1% to trade at 3,286. Nasdaq 100 futures
COMP, + 1.04%
lost 10 points or 0.1% to trade at 9,078.
DJIA, + 0.29%
on Tuesday rose 83.28 points, or 0.3%, to end at 28,907.05, 0.2% from its Thursday record close of 28,956.90. The S & P 500
SPX, + 0.70%
rose 22.78 points or 0.7% and ended at 3,288.13 during the Nasdaq Composite
COMP, + 1.04%
closed at 9,273.93, a gain of 95.07 points or 1%. The closing prices on Monday marked the third record of the new year for the S & P 500 and the fourth for the Nasdaq.
What drives the market?
Wall Street's major banks kicked off the earnings season on Tuesday. The fourth quarter results were about to open JPMorgan Chase & Co.
JPM, + 0.83%.
C., + 1.77%
and Wells Fargo & Co.
Analysts said the start of the earnings season could fade US trade problems ahead of the expected signing of a so-called Phase 1 agreement on Wednesday.
China will commit to buying $ 200 billion worth of goods in four industries in two years, according to several reports. This includes $ 75 billion in industrial goods, $ 50 billion in energy products, $ 40 billion in agricultural products and services worth $ 40 billion. White House trade advisor Navarro also said that the agreement contains a very strong enforcement mechanism and that the US can unilaterally reintroduce tariffs if China breaches any commitments (Politico). At the same time, the reports continued to express skepticism about the ability to achieve a more meaningful Phase II deal (SCMP).
The U.S. Treasury Department lifted China's designation as a currency manipulator late Monday. News reports that such a move was imminent to boost stocks during the session.
See: As investor optimism nears a two-year high, analysts are warning that equity markets will retreat
China's yuan has been firm since the end of last year and has reclaimed much of the land lost in late summer fainting. This was supported by growing optimism about trade policy and early signs of stabilization in the Chinese economy, the economists said.
"Markets will look for signs of concern this reporting season, with the outlook and sentiment more pressing given the valuation situation," said Bethel Loh, macro strategist at ThinkMarkets, in a note. "Even if we get some below-average results, the markets affected by sugar damage need only be influenced by a positive outlook for the future to stay long-term."
According to FactSet, the earnings of the S&P 500 index companies are expected to decrease by 2.0% in the fourth quarter.
See: Why the Chinese Yuan is Rebounding Against the US Dollar
What is on the economic calendar?
The National Federation of Independent Business announced that its Small Business Optimism Index dropped 2 points to 102.7 in December.
The economic calendar shows the US consumer price index for December at 8:30 a.m. The economists surveyed by MarketWatch expect the index to rise by 0.3% on average, while the core value, which excludes the volatile food and energy prices, should show an increase of 0.2%.
New York Federal Reserve Bank President John Williams, a voting member of the Fed's Interest Rate Committee, is expected to deliver a speech at the London School of Economics at 9:00 a.m.
The President of the US Federal Reserve from Kansas City, Esther George, who did not vote in 2020, will give a speech in Kansas City at 1 p.m. Eastern.
Which companies are in focus?
JPM, + 0.83%
The reported earnings exceeded Wall Street forecasts. The shares of the Dow component rose by 1.8% in the pre-market campaign.
Delta Air Lines Inc.
DAL, + 0.42%
the shares rose more than 5% before entering the market after exceeding profit and sales expectations.
How do other markets act?
Oil futures rallied on Tuesday to trigger a five-day series of losses that pushed the US benchmark to its lowest level since early December. West Texas Intermediate Crude for February delivery
CLG20, + 0.64%
rose 38 cents or 0.7% to $ 58.46 a barrel during March of Brent
BRNH20, + 0.76%
rose 45 cents or 0.7% to $ 64.65 a barrel.
European stocks rose slightly on Tuesday the eve of the earnings season. After losing for two consecutive sessions, the Stoxx Europe has 600
rose 0.12% to 418.89, near the record close of 419.74 on December 27.
NIK, + 0.73%
rose 0.7% from a Monday holiday to 24,025. Hong Kong's Hang Seng Index
fell 0.2% to 28,885, while China's CSI 300
Index slipped 0.3 pct to 4189.89