Stock futures on the Dow Jones, Nasdaq Composite, and S&P 500 have all gained more than a percent in the last several days, with Nasdaq Composite up 1.5% and the S&P 500 up 1.5%.
A relatively calm weekend has helped markets settle, according to Sevens Report Research founder Tom Essaye.
Investors, fresh off a week of stock market declines, may appreciate the absence of new information. In response to the Federal Reserve’s more aggressive interest rate increasing strategy, all three main indices plummeted by at least 4%. Fears of a recession in the United States arose as a result of higher interest rates, intended to combat the country’s high inflation. If nothing else, it will at the very least hinder economic development.
James Bullard, president of the St. Louis Federal Reserve, made this statement Monday, indicating that the U.S. economy should continue to expand over the next several months. His warnings about the dangers of excessive inflation were not ignored.
For the time being, market players are crossing their fingers that additional Fed speakers will not derail Tuesday’s gain. There will be a speech by Loretta Mester, president of the Cleveland Federal Reserve System, at noon Eastern time and a speech by Richmond Federal Reserve president Tom Barkin at 3:30. If the Fed can moderate inflation without precipitating a recession, markets would prefer to hear that, but the chances have fallen significantly.
Nevertheless, for the stock market, the emphasis must be on how rate increases by the Fed will affect profitability. Despite this year’s market decline, experts have been unwilling to alter their profit forecasts. According to FactSet, earnings per share projections for S&P 500 businesses have climbed this year, despite the deteriorating economic outlook. This year, analysts at Evercore believe that the index’s earnings might fall by around 8% because of the average reduction in earnings projections over the prior three recessions.
If the rise has legs—or is simply another chance to sell on the bounce—it will all come down to how much those results can boost the stock price.
The following are some of the stocks that made headlines on Tuesday:
There was an increase of 1.1% in the value of TWTR (NYSE: TWTR). At the Qatar Economic Forum in Doha, Elon Musk told an audience that he will be “driving the product” at Twitter when he completes the purchase of the social media business while emphasizing that he does not necessarily want to serve as CEO.
A Bloomberg interview with Tesla CEO Elon Musk revealed that the electric-vehicle company’s overall workforce might be reduced by as much as 3.5 percent as a consequence of job cutbacks.
After Kellogg K –0.19 percent (K) announced intentions to split into three separate entities, the cereal and snack giant’s stock rose 6.2%.
The shares of Mondelez (MDLZ) rose 1.2% on the announcement that it will pay $2.9 billion for the energy bar company Clif Bar.
Credit Suisse raised Exxon Mobil (XOM) from Neutral to Outperform, resulting in a 2.6% increase in share price.