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U.S. stock-index futures on Tuesday pointed to a solid start to October and the third quarter as investors weigh fresh economic reports and Federal Reserve speakers, and as China celebrates the 70th anniversary of the founding of the People’s Republic.
What are major indexes doing?
Futures for the Dow Jones Industrial Average
YMZ19, +0.23%
gained 44 points, or 0.2%, to reach 26,945, those for the S&P 500 index
ESZ19, +0.25%
climbed 4.75 points to 2,983.25, a gain of 0.2%. Nasdaq-100 futures
NQZ19, +0.34%
advanced 18.50 points, or 0.2%, to reach 7,789.
On Monday, the Dow
DJIA, +0.36%
rose 96.58 points, or 0.4%, to end at 26,916.83, while the S&P 500 index
SPX, +0.50%
advanced 14.95 points, or 0.5%, to finish at 2,976.74. The Nasdaq Composite Index
COMP, +0.75%
closed at 7,999.34, a gain of 6.91 points, or 0.1%.
For the month of September, the Dow gained 2%, the S&P advanced 1.7% and the Nasdaq added 0.5%. For the quarter, the Dow and the S&P 500 both rose 1.2%, but the Nasdaq fell 0.1%.
What’s driving the market?
Equity markets appeared set to kick off a new period of trading in a slight updraft as investors digested a number of geopolitical developments and awaited a fresh round of economic updates.
Federal Reserve Bank of Chicago President Charles Evans said Tuesday that the central bank’s most recent rate cuts have helped to maintain the economic expansion now in its record-setting 11th year, despite headwinds from a yearlong Sino-American trade dispute.
Evans estimated that annual domestic growth should be around 2.25% in 2019, which he described as a “a solid number, as it exceeds my view of the economy’s long-run potential growth rate,” in the text of a speech to be delivered in Frankfurt.
The Fed official’s comments come as the World Trade Organization on Tuesday said trade flows this year are set to increase at the weakest pace since the 2008 financial crisis brought the global economy to its knees.
“Job creation may be hampered as firms employ fewer workers to produce goods and services for export,” said Roberto Azevêdo, the WTO’s director general, in the most recent global forecast by the Geneva-based organization.
Evans said he expects the jobless rate to stay at under 4%, with stubbornly low inflation creeping up toward the Fed’s annual 2% target over the next several years.
“The mood is optimistic as we begin the final trading quarter of this year. Despite deep threats of impeachment over in the US, the S&P 500 index is still up over 18%, the Dow Jones 15.3% and the Nasdaq 20.56%,” wrote Naeem Aslam, chief market analyst at ThinkMarkets U.K., in a Tuesday research note.
Elsewhere, President Xi Jinping presided over a military parade marking the 70th anniversary of the People’s Republic of China. Xi said “there is no force that can shake the foundation of this great nation,” in a speech commemorating Chinese Communist Party’s rule.
Meanwhile, a Hong Kong protester was reportedly shot in the chest with a live round, representing a possible major escalation in the conflict between China and the semiautonomous nation on Tuesday.
Separately, markets continue to pay attention developments related to President Donald Trump’s impeachment inquiry after the Wall Street Journal reported that Secretary of State Mike Pompeo listened in on the July 25 phone call between Trump and Ukrainian President Volodymyr Zelensky, a disclosure that ties the State Department more closely to the House impeachment inquiry.
Looking ahead, a number of other Fed speakers are on deck Tuesday, including Fed Gov. Richard Clarida at 8:50 a.m. Eastern Time in Washington, St. Louis Fed President James Bullard and Fed Gov. Michelle Bowman are due to speak after 9 a.m. in St. Louis, Missouri.
On the data front, closely followed reports on manufacturing are due, with the Institute for Supply Management’s Manufacturing index coming at 10 a.m. and the purchasing managers’ manufacturing index, or PMIs due at 9:45 a.m. A report on construction spending also will be released at 10 a.m.
How are other markets trading?
The yield on the 10-year U.S. Treasury note
TMUBMUSD10Y, +3.85%
rose to 1.734%, compared with a Monday afternoon close at 1.675%.
In commodities markets, West Texas Intermediate crude-oil for November delivery
CLX19, +1.20%
gained 55 cents, or 1%, to $54.63 a barrel on the New York Mercantile Exchange, a day after a 3.3% drop for the commodity.
Gold for December delivery
GCZ19, +0.08%
picked up $2.50, or 0.2%, to reach $1,475.90 an ounce after finishing Monday’s session at a two-month low.
In Asia, Chinese benchmarks were closed in observance of its 70th anniversary. Japan’s Nikkei 225
NIK, +0.59%,
meanwhile, gained 0.6%, wiping out a similar loss from Monday. European stocks traded mixed, with the Stoxx Europe 600
SXXP, -0.32%,
down 0.4%.
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