Market Snapshot: Dow aims to extend gains as investors await Apple event, fresh data and start of Fed gathering

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U.S. stocks were indicated firmly higher early Tuesday, putting equity indexes on track to mark another session of gains, as the Federal Reserve is set to kick off its two-day policy meeting and as investors await an important product debut for Apple Inc., as well as a fresh round of economic reports.

How are equity benchmarks performing?

Futures for the Dow Jones Industrial Average YM00, +0.71% YMU20, +0.70%  rose 194 points to reach 28,065, a gain of 0.7%, those for the S&P 500 index ES00, +0.74% ESU20, +0.74%  climbed 24.80 points, or 0.7%, at 3,397, while Nasdaq-100 futures NQ00, +0.99% NQU20, +1.00%  advanced 111.50 points, or 1%, to 11,378.25.

On Monday, the Dow DJIA, +1.18% rose 327.69 points, or 1.2%, to finish at 27,993.33, after briefly trading above the 28,000 threshold. The S&P 500 SPX, +1.27% added 42.57 points, or 1.3%, closing at 3,383.54. The Nasdaq Composite COMP, +1.87% climbed 203.11 points, or 1.7%, to end at 11,056.65, snapping a two-session losing streak.

The Russell 2000 index RUT, +2.65% of small-capitalization stocks rose 39.70 points, or 2.7%, to end at 1,536.97, outperforming the major stock benchmarks.

What’s driving the market?

Stocks looked to climb solidly higher early Tuesday as a flurry of business activity injected a degree of normalcy into market sentiment, despite the coronavirus pandemic that was hitting many parts of the world hard.

Investors were watching for a closely followed event by Apple Inc. and a hotly anticipated initial public offering.Meanwhile, investors are expecting central banks to maintain a posture that should be accommodative to buying assets perceived as risky amid the worst viral outbreak in recent memory.

The Fed is slated to start its policy-setting meeting later today, followed by a news conference and fresh statement from its officials on Wednesday, while central-bank decisions from the Bank of England and the Bank of Japan follow on Thursday.

“Global markets are focused on the two-day Fed meeting which will start on Tuesday, markets are modestly positive as investors anticipate a dovish outcome,” wrote Mihir Kapadia, the CEO of Sun Global Investments, in a Tuesday note. The meeting of the policy-setting Federal Open Market Committee also would be the first since the central bank introduced its new policy framework of average-inflation targeting.

“Although other factors across the continent have helped with this positive momentum, the overwhelming factor which is guiding the markets is the Fed,” wrote Kapadia. “Investors will be looking for signs as to what the U.S. growth and inflation outlook looks like and the possible responses from the Fed,” he said.

Investors are also watching for Snowflake Inc., a cloud-computing company, which is set to list on the New York Stock Exchange later today and has the backing of Warren Buffett’s Berkshire Hathaway BRK.A, +0.79% BRK.B, +0.92%  and CRM, +1.45%.

On Monday, Snowflake raised the proposed price range for its initial public offering to $ 100 to $ 110, up from a prior $ 75 to $ 85. The company is planning to offer 28 million shares to raise up to $ 3.08 billion

Separately, Apple Inc. AAPL, +2.99% will hold its first virtual-only product reveal at 1 p.m. Eastern Time, where the Cupertino, Calif., tech behemoth is expected to show off its latest smartwatch and iPads, a debut which may provide a fresh catalyst for shares of the popular company.

Momentum higher for stocks on Thursday came as retail sales in China grew in August for the first time in 2020, as the world’s second-largest economy—and the site of the first case of COVID-19 in December—recovers from the global epidemic. Total retail sales of consumer goods grew 0.5% year-over-year last month, according to China’s National Bureau of Statistics.

Looking ahead Thursday, investors are awaiting a report on manufacturing activity in the New York Area, the Empire State Manufacturing Index as well as a reading of import and export prices, both due at 8:30 a.m. Eastern Time. A report on industrial production for August is due at 9:15 a.m.

Read: IPO market gears up for busiest week since May of 2019—Uber’s IPO week—with 12 deals on tap

Which stocks were in focus?
  • Shares of Oracle Corp. ORCL, +4.31%  was in focus after the Wall Street Journal reported that it was reviewing the companies bid to become the “strategic partner” for TikTok’s U.S. operations, which is owned by China-based ByteDance.

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