Stock futures have shown a substantial recovery from an overnight nosedive and are currently pointing to a significantly higher open on Wall Street. The Dow futures are up by 315 points and the Nasdaq futures are up by 71 points, suggesting the tech-heavy index could reach a new record high.
The futures fell sharply overnight as comments from White House trade adviser Peter Navarro seemed to suggest President Donald Trump had decided to terminate the U.S.-China trade deal.
“It’s over,” Navarro said in response to a question about the trade deal in an interview on Fox News, adding that the “turning point” was China’s failure to warn the United States about the coronavirus outbreak.
However, Navarro subsequently released a statement attempting to clarify his remarks, claiming his initial comments were “taken wildly out of context.”
“They had nothing at all to do with the Phase I trade deal, which continues in place,” Navarro said. “I was simply speaking to the lack of trust we now have of the Chinese Communist Party after they lied about the origins of the China virus and foisted a pandemic upon the world.”
Trump also sought to reassure investors with a post on Twitter declaring the trade deal is “fully intact” and saying he hopes China will “continue to live up to the terms of the Agreement!”
The futures quickly recovered from the overnight slump and have seen further upside since then, reflecting recent upward momentum on Wall Street.
Stocks may continue to benefit from optimism about a quick economic recovery, as traders seem unfazed by the rising number of coronavirus cases and hospitalizations in several states across the country.
Shortly after the start of trading, the Commerce Department is scheduled to release its report on new home sales in the month of May.
Economists expect new home sales to jump by 2.7 percent to an annual rate of 640,000 in May after rising by 0.6 percent to a rate of 623,000 in April.
Stocks moved mostly higher over the course of the trading day on Monday after showing a lack of direction early in the session. The tech-heavy Nasdaq closed higher for the seventh straight session, reaching a new record closing high.
The major averages all finished the day firmly in positive territory. While the Nasdaq jumped 110.35 points or 1.1 percent to 10,056.47, the Dow climbed 153.50 points or 0.6 percent to 26,024.96 and the S&P 500 advanced 20.12 points or 0.7 percent to 3,117.86.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Tuesday. Japan’s Nikkei 225 Index rose by 0.5 percent, while Hong Kong’s Hang Seng Index surged up by 1.6 percent.
The major European markets have also shown strong moves to the upside on the day. While the German DAX Index has soared by 2.7 percent, the French CAC 40 Index is up by 1.7 percent and the U.K.’s FTSE 100 Index is up by 1.5 percent.
In commodities trading, crude oil futures are rising $0.52 to $41.25 a barrel after climbing $0.90 to $40.73 a barrel on Monday. Meanwhile, after jumping $13.40 to $1,766.40 an ounce in the previous session, gold futures are advancing $9.30 to $1,775.70 an ounce.
On the currency front, the U.S. dollar is trading at 106.61 yen compared to the 106.91 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.1331 compared to yesterday’s $1.1261.
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