U.S. stock futures pointed to a modest rise at the open Wednesday, putting the Dow on track to build on an earnings-driven rally that has taken it back into positive territory for the year.
Investors are getting a fresh round of corporate results for this session, as well as Federal Reserve speeches and the central bank’s Beige Book report.
What are the main benchmarks doing?
Dow Jones Industrial Average futures YMM8, +0.22% rose by 80 points, or 0.3%, to 24,786, while S&P 500 futures ESM8, +0.24% added 9.15 points, or 0.3%, to 2,716. Nasdaq-100 futures NQM8, +0.11% tacked on 19 points, or 0.3%, to 6,848.25.
On Tuesday, the Dow DJIA, +0.10% S&P 500 SPX, +0.20% and Nasdaq Composite COMP, +0.03% all gained for a second day in a row, leaving the Dow up by 0.3% for the year. The S&P and Nasdaq are higher by 1.2% and 5.5%, respectively, in 2018.
What’s driving markets?
First-quarter earnings reports have grabbed investors’ attention this week, with Netflix Inc. NFLX, -0.36% Goldman Sachs Group Inc. GS, +1.02% and UnitedHealth Group Inc. UNH, -0.29% among the companies that have posted encouraging results.
The S&P 500 components are expected to see earnings growth of 17.3% for the period, the fastest rate of expansion since 2011.
What are strategists saying?
“There is one strong force driving the equity markets higher on Wall Street — the stellar earnings season,” said Naeem Aslam, chief market analyst at Think Markets UK, in a note.
Fears around a potential trade war and geopolitical concerns “have faded very much,” Aslam added. He was referring to the worries in recent weeks about the trade skirmish between the U.S. and China, as well as jitters about the conflict in Syria.
North Korea also has been a concern this year, and the isolated nation is in the news again Wednesday, thanks to reports that Central Intelligence Agency Director Mike Pompeo took a secret trip to meet with North Korean leader Kim Jong Un in Pyongyang over Easter. Pompeo went to discuss the terms of Kim’s upcoming summit with President Donald Trump.
Which stocks are in focus?
Shares in air carrierUnited Continental Holdings Inc. UAL, +1.90% and railroad operatorCSX Corp. CSX, +5.41% rose 3% and 5% in premarket trading, respectively, after the companies each posted better-than-expected quarterly profit late Wednesday.
International Business Machines Corp.’s stock IBM, -5.85% fell 5.7% in premarket action as analysts noted its earnings beat late Tuesday was driven by a one-time tax gain. In addition, IBM Chief Financial Officer James Kavanaugh told analysts on the tech titan’s conference call that they should not count on a continued boost from new mainframe sales.
Shares in banking giant Morgan Stanley MS, +2.55% added 2.3% premarket after its quarterly profit topped estimates.
Health-care heavyweight Abbott Laboratories ABT, -1.57% shares dropped 1% although the health care company reported first-quarter profit and sales that rose above expectations.
Southwest Airlines Co.’s stock LUV, +1.75% fell 0.3% ahead of the open, building on Tuesday’s retreat. The discount carrier on Tuesday marked its first passenger death in its 50-year history following a blown engine. The airline says it has started an investigation into the accident.
VMware Inc. VMW, +2.83% climbed 3% premarket following reports that storied activist investor Carl Icahn has taken a medium-sized stake in the software company.
Shares of Textron Inc. TXT, +5.78% soared 6.8% in premarket trade after the industrial manufacturing company said it agreed to sell its tools and test business to Emerson Electric Co. EMR, +0.75% for $810 million in cash, and reported a first-quarter profit and sales beat estimates.
Which economic reports are on tap?
The Fed’s Beige Book is scheduled to hit at 2 p.m. Eastern Time. It will give anecdotal evidence on economic conditions from each of the central bank’s 12 districts.
Check out: MarketWatch’s Economic Calendar
New York Fed President William Dudley is due to give a speech on the economic outlook at a college in New York City at 3:15 p.m. Eastern. After that, the Fed’s vice chair for bank supervision, Randal Quarles, is slated to make remarks at the Bretton Woods Committee in Washington, D.C., at 4:15 p.m. Eastern.
What are other markets doing?
European stocks SXXP, +0.09% traded mixed, while Asian markets closed with gains.
The ICE U.S. Dollar Index DXY, +0.04% inched up. Gold futures GCM8, +0.57% rose, and oil futures CLK8, +2.15% advanced after the American Petroleum Institute issued bullish U.S. inventory data.