By Peter Nurse
Investing.com - U.S. stocks are set to open in positive territory Wednesday, continuing recent gains, amid rising confidence that the coronavirus outbreak is over its worst and the economy is moving closer towards a recovery.
At 7 AM ET (1100 GMT), S&P 500 futures traded 32 points, or 1.1%, higher, Nasdaq 100 futures up 65 points, or 0.7%. The Dow futures contract rose 330 points, or 1.3%.
The Dow Jones Industrial Average cash index is now at its highest level since March 10, the S&P 500 since March 5, while the Nasdaq Composite is at a three-month high. These indices are set to post their second straight monthly gain.
Investors have been emboldened by increased hopes of a coronavirus vaccine from a number of sources as well, few indications of a secondary spike in cases as states reopen and signs that the U.S. economy is crawling back towards normalcy from the pandemic shutdown.
“The worst may be over for the economy,” said Chris Rupkey, chief economist at MUFG in New York. “We still can’t see a V-shaped recovery, but at least this is looking like the shortest recession in history which will be measured in months not years.”
The one blot on the horizon has been the simmering tensions between Washington and Beijing, with China’s encroachment of the autonomy of Hong Kong the latest trigger.
In corporate news, Boeing (NYSE:BA) will be in the spotlight as the plane manufacturer is expected this week to announce about 2,500 voluntary layoffs as it struggles with the coronavirus-driven collapse of global air travel.
Tesla (NASDAQ:TSLA) will also be in focus as the electric car manufacturer has dropped the price of its cars in North America and China by up to 6% in a bid to boost sales.
In economic news, investors will look to the release of the Federal Reserve’s Beige Book at 2 PM ET (18:00 GMT), its assessment of the economy.
Views will come from the 12 Fed districts, giving insight into how different parts of the country handled lockdown measures and early moves to reopen.
The crude oil market slipped back Wednesday, consolidating after recent hefty gains. Investors will get a measure of how U.S. stockpiles look when the American Petroleum Institute reports after the bell, a day late due to Monday’s holiday.
Seevol.com reported a 4.26-million-barrel decline for the week to May 22 at the Cushing, Okla. hub that stores crude delivered against expiring spot contracts of WTI.
At 7:05 AM ET, U.S. crude June futures traded 1.2% lower at $33.95 a barrel. The international benchmark Brent contract fell 1.4% to $35.67.
Elsewhere, gold futures fell 0.5% to $1,697.40/oz, while EUR/USD traded at 1.1018, up 0.4%.