Stock futures rose on Tuesday as the Dow Jones Industrial Average and S&P 500 attempted to bounce back from their lowest closes in nearly two years.
S&P 500 futures rose 0.8% and Nasdaq 100 futures rose 1%. Shares tied to the Dow Jones Industrial Average rose 157 points, or 0.5%.
GBP/USD rebounded slightly after falling to an all-time low earlier this week. Sterling rose more than 1% to $1.087 after hitting an all-time low of $1.0382.
U.S. Treasury yields also retreated from highs, boosting sentiment. The yield on the benchmark 10-year Treasury note fell nearly 5 basis points to 3.823%.
The futures move came after a five-day losing streak in stocks, with the S&P 500 closing at its lowest level since 2020. The Dow Jones fell more than 300 points on Monday, entering a bear market after falling more than 20%. a record high. The 30-stock average also posted its lowest close since late 2020.
Technical indicators show that the sell-off is historic. The S&P 500’s 10-day advance decline line has hit a new all-time low, according to Bespoke Investment Group, meaning market breadth is at its lowest level in at least 32 years.
There appeared to be several catalysts for the latest sell-off, including an aggressive Federal Reserve and soaring interest rates, which in turn roiled currency markets. Sterling fell to a record low against the dollar on Monday, rattling investors on both sides of the Atlantic.
“U.S. investors normally don’t pay too much attention to things like this, especially lately. So that means to me that fear now grabs investors more than it used to. And that in turn leads to the fact that we’re really in a The moment of surrender at the bottom,” said Max Gokhman, CIO of AlphaTrAI.
On Tuesday, investors will get several new economic data, including September consumer confidence, August durable goods orders and July home prices. Wall Street is increasingly concerned that the Fed’s six-month inflation battle will push the economy into recession.