U.S. stock futures remained relatively stable on Tuesday night following a second consecutive day of gains for the S&P 500. The Dow Jones Industrial Average futures saw a modest increase of 26 points, equating to a 0.06% rise. In comparison, S&P 500 futures experienced a slight uptick of 0.07%, while Nasdaq 100 futures advanced by 0.04% during the extended trading session.
In extended trading, shares of CrowdStrike Holdings fell over 6% after the cybersecurity firm issued a disappointing revenue forecast for the upcoming quarter. Conversely, Hewlett Packard Enterprise shares surged by 3% following the company's impressive earnings report, which surpassed analysts' expectations on both revenue and profit margins.
Wall Street concluded a robust session on Tuesday, witnessing back-to-back gains. The 30-stock Dow rose by more than 200 points, or 0.5%, marking its fourth consecutive day of positive movement. The S&P 500 and Nasdaq Composite performed even better, climbing 0.6% and 0.8% respectively, driven largely by a rally in tech stocks. Notably, Nvidia saw a nearly 3% increase, reclaiming its position as the world's most valuable public company, surpassing Microsoft.
The recent rally has bolstered investor confidence, suggesting that stocks may have turned a corner regarding tariff issues. This sentiment was reinforced by a series of reversals from former President Donald Trump, which led traders to believe that the administration is primarily using high tariffs as a negotiation tactic. Furthermore, a federal court recently struck down Trump's tariffs, which fueled optimism that the market has already absorbed the worst of these tariff impacts, despite their temporary reinstatement by an appeals court.
As the response to trade headlines becomes increasingly muted, market analysts are becoming more optimistic about potential gains for stocks. Many believe there is still cash on the sidelines that could propel the market even higher, especially with more favorable policy developments anticipated later in the year. This week, Deutsche Bank's chief U.S. equity and global strategist, Binky Chadha, raised his year-end forecast for the S&P 500, indicating a bullish outlook.
"We have a quiet week, and markets are rallying," stated Tom Lee, head of research at Fundstrat Global Advisors, during an appearance on CNBC's Closing Bell. "I think the risk is now of a substantial leg-up rally from here."
However, some analysts remain cautious, noting that the full repercussions of tariff uncertainties may still be forthcoming. Investors will be closely monitoring upcoming economic indicators for signs of potential softening in the market. This week’s labor market insights will be highlighted by the ADP private payrolls report scheduled for Wednesday, followed by weekly jobless claims on Thursday and the significant May jobs report on Friday. Additionally, the Federal Reserve's Beige Book will be released on Wednesday afternoon, offering further insights into the economic landscape.
