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Wall Street set to open higher as technology, growth stocks rebound

Written by corres2

A Wall Street sign is pictured outside the New York Stock Exchange in New York, October 28, 2013. REUTERS/Carlo Allegri

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  • Walmart slides after cutting earnings forecast
  • April retail sales rise in-line with estimates
  • Futures up: Dow 1.30%, S&P 1.55%, Nasdaq 1.81%

May 17 (Reuters) – Wall Street’s main indexes were set to open higher on Tuesday, as strong forecasts from Home Depot and United Airlines added to an upbeat global mood driven by hopes of easing crackdown on tech firms and COVID-19 in China.

Big technology and growth companies led the rebound in premarket trading, with Microsoft Corp (MSFT.O), Apple Inc (AAPL.O), Nvidia Corp (NVDA.O) and Tesla Inc (TSLA.O) up between 1.5% and 2.3%.

Home Depot Inc (HD.N) added 3.9% after raising its full-year sales forecast on firm demand for home improvement tools and building materials. read more

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United Airlines Holdings Inc (UAL.O) rose 4% after the carrier lifted its current-quarter revenue forecast, boosting shares of Delta Air (DAL.N), American Airlines (AAL.O) and Spirit Airlines (SAVE.N). read more

“If you have exhausted sellers, there is no one else left to sell…the market has really been pummeled,” said Mimi Duff, senior client advisor at investment advisory firm GenTrust.

“So at the very sight of any good news you can get a bounce but really what we are looking for is some consolidation.”

Meanwhile, U.S. retail sales increased solidly in April as consumers bought motor vehicles amid an improvement in supply and frequented restaurants, showing no signs of demand letting up despite high inflation. read more

But rising costs weighed on Dow component Walmart Inc (WMT.N), which fell 6.3% after the retail giant cut its annual profit forecast, signaling a bigger hit to margins.

Shares of rival retailers Costco (COST.O), Target (TGT.N), Dollar Tree (DLTR.O) fell between 0.5 and 1.8%. read more

In Europe and Asia, shares jumped as Shanghai achieved the long-awaited milestone of three straight days with no new COVID-19 cases outside quarantine zones, raising hopes that restrictions might be eased. read more

Chinese firms listed on the U.S. indexes also rose on signs that China is looking to ease a regulatory crackdown on the tech sector after Vice-Premier Liu He told executives that relations between the government and market need to be “properly managed”. read more

A positive first-quarter earnings season has been overshadowed by worries about the Ukraine war, soaring inflation, COVID-19 lockdown in China and aggressive policy tightening by central banks.

The S&P 500 (.SPX) has declined 3% and the Nasdaq (.IXIC) 5.5% so far in May, due to losses in growth stocks.

A slew of Federal Reserve policymakers, including Chair Jerome Powell, are scheduled to speak later in the day and their comments would be parsed for clues on the path of future interest rate hikes.

Traders now see a nearly 80% probability of a 50-basis point rate hike in June.

At 8:46 a.m. ET, Dow e-minis were up 419 points, or 1.3%, S&P 500 e-minis were up 62.25 points, or 1.55%, and Nasdaq 100 e-minis were up 221.75 points, or 1.81%.

Among other stocks, Advanced Micro Devices (AMD.O) gained 3.7% after Piper Sandler upgraded the semiconductor designer’s stock to “overweight”.

Citigroup (C.N) jumped 5.2% after Warren Buffett’s Berkshire Hathaway (BRKa.N) disclosed a nearly $3 billion investment in the U.S. lender.

Take-Two Interactive Software (TTWO.O) gained 5.4% after the Grand Theft Auto” publisher posted upbeat fourth-quarter profit. read more

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Reporting by Amruta Khandekar and Devik Jain in Bengaluru; Editing by Arun Koyyur

Our Standards: The Thomson Reuters Trust Principles.


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