U.S. stock-index futures were mixed Tuesday as investors continue to keep an eye on developments surrounding U.S.-China trade talks and China’s domestic economy.
What are indexes doing?
Futures on the Dow Jones Industrial Average YMH9, +0.09% fell 1 point, or less than 0.1%, to 25,812, while S&P 500 futures ESH9, +0.13% were up 2.65 points, or 0.1%, at 2,793. Nasdaq-100 futures, meanwhile, NQH9, +0.14% rose 4.75 points, to 7,151, a rise of 0.1%.
On Monday, the Dow DJIA, -0.79% ended at a 2-week low, falling 206.67 points, or 0.8%, to 25,819.65. The S&P 500 SPX, -0.39% fell 11.07 points, or 0.4%, to close at 2,792.62, and the Nasdaq Composite Index COMP, -0.23% declined 17.79 points, or 0.2%, to 7,577.57.
What’s driving the market?
Monday’s soft close came as initial enthusiasm faded over reports that U.S. and Chinese negotiators were close to completing a trade deal.
China on Tuesday lowered its economic growth targetfor 2019 to between 6% and 6.5%, acknowledging a deepening slowdown. Premier Li Keqiang at the opening of the annual session of China’s legislature outlined plans to underpin the economy, including an increase in deficit spending, new tax cuts and other fee cuts for businesses, and a boost in bank lending to small and private companies by 30%.
What stocks are worth watching?
Shares of retail chain store operator Target Corp. TGT, -0.37% rose 6.2% in premarket action after topping fourth-quarter earnings and same-store sales top expectations.
Shares of retailer L Brands LB, -2.51% were in focus Tuesday, after The Wall Street Journal reported that activist investor Barington Capital Group LP had built up a position in the stock and planned to urge the company to split its fast-growing Bath & Body Works brand from its struggling Victoria’s Secret operation. The stock is up 2.6% before the bell.
Kohl’s Corp. KSS, -2.39% stock rose 4.7% in premarket trade Tuesday, after the retailer reported a surprise jump in same-store sales, while raising its dividend by 9.8%.
What are analysts saying?
“Trade optimism could only take the stock market so far. High level talks between the two largest economies have been ongoing and although they appear close to bearing fruit, the fact remains that the optimism has already been priced in,” said Alfonso Esparza, senior market analyst at Oanda, in a note. “Details on the agreement will be needed to unlock gains as investors preferred government bonds until an official announcement dispels all doubts of the U.S.-China agreement.”
Which economic data and Fed speakers are in focus?
Boston Fed President Eric Rosengren said in a speech Tuesday morning that his “earlier concerns that the economy might overheat . . . seem somewhat less concerning at this juncture,” while predicting that U.S. growth would slow modestly this year, though still above its long-run potential growth rate.
“Altogether, it is a good time for policy makers to be patient, taking the time to evaluate [risks] . . as well as the underlying strength of the economy,” he told the New England Chapter of the National Association of Corporate Directors.
At 9:45 a.m. Eastern Time, Markit will issue its final reading of its purchasing-managers index for the U.S. services sector for February.
The Commerce Department will issue its estimate of new homes sales for the month of December at 10 a.m., a report delayed due to the linger effects of the government shutdown.
At the same time, the Institute for Supply Management will also issue its reading of the services sector, or nonmanufacturing index.
At 2 p.m. the Congressional Budget Office will announce the size of the federal budget deficit in January.
How are other markets trading?
Asian stocks closed Tuesday on a mixed note, with shares on Japan’s Nikkei 225 NIK, -0.44% moving lower, while Chinese stocks on the Shanghai Composite Index SHCOMP, +0.88% and the Shenzhen Composite Index 399106, +2.28% advancing on the day.
European stocks were trading mostly lower Tuesday, with the Stoxx Europe 600 SXXP, -0.20% down 0.3%.
In commodities markets, the price of oil CLJ9, +0.12% was advancing, while gold GCJ9, -0.05% edged lower. The U.S. dollar DXY, +0.16% meanwhile, was virtually unchanged relative to its peer currencies.
