Stocks looked set to take a breather on Wednesday from steep losses fueled by concerns about the impact on the US economy of interest rates staying higher for longer.
S&P 500 (^GSPC) futures ticked up 0.3%, while Dow Jones Industrial Average (^DJI) futures put on about 80 points, or 0.2%. Contracts on the tech-heavy Nasdaq 100 (^NDX) rose 0.2%.
The moves point to a slight recovery for the major stock gauges after a brutal selloff on Tuesday that saw the Dow post its worst day since March. Waning consumer confidence and a looming government shutdown brought more worry to investors already fretting about Federal Reserve’s message that rates likely haven’t peaked yet.
Stocks have fallen in recent days as the market increasingly took on board that borrowing costs would stay elevated for longer than hoped. But the signs of a recovery suggest some investors believe the shakeout may have been overdone, according to analysts.
The benchmark 10-year Treasury yield (^TNX) pulled back on Wednesday after settling at another 16-year high the previous session. The recent surge in yields has weighed on risk markets like stocks.
Meanwhile, the prospect of a US government shutdown is increasingly preying on nerves, as the weekend deadline for a budget deal nears. Late on Tuesday, the Senate put forward a 79-page bill to keep the government funded until November 17, likely the last chance of averting closure.
In individual stocks, Costco shares slipped ahead of the bell after the retailer missed on same-store sales expectations even as its earnings beat estimates.
On deck in economic data are updates on durable goods and mortgage applications, appetizers for the US second quarter GDP report on Thursday and the Fed-favored reading on PCE inflation on Friday.
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KStocks poised for higher open after brutal losses
Wall Street stocks took a cautiously brighter tone on Wednesday, on the heels of deep declines the previous session as worries about higher interest rates and a shutdown built.
Futures on the S&P 500 (^GSPC) rose 0.35%, while those on the Dow Jones Industrial Average (^DJI) added 0.26%, or 87 points. Contracts on the tech-heavy Nasdaq 100 were up 0.33%.
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