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U.S. stock futures on Wednesday pointed to an extension of the previous session’s rally, as traders wait for the Federal Reserve’s monetary policy decision and react to China’s statement of support for its markets.
What’s happening
- Futures on the Dow Jones Industrial Average YM00, +0.86% rose 290 points, or 0.9%, to 33717
- Futures on the S&P 500 ES00, +1.05% gained 1.1%, or 47 points, to 4301
- Futures on the Nasdaq 100 NQ00, +1.68% rose 1.8%, or 237 points, to 13686
On Tuesday, the Dow Jones Industrial Average DJIA, +1.82% rose 599 points, or 1.82%, to 33544, the S&P 500 SPX, +2.14% increased 89 points, or 2.14%, to 4262, and the Nasdaq Composite COMP, +2.92% gained 367 points, or 2.92%, to 12949.
What’s driving markets
China on Wednesday announced a far-reaching change to its policy stance, saying it would support its economy with monetary policy, attempt to limit the negative economic impact from policy changes, and work with U.S. regulators over delisting concerns. The statement sent Hong Kong-listed tech giants including Alibaba BABA, -1.29% and Baidu BIDU, -0.54% soaring.
Traders also were hopeful of diplomatic talks between Russia and Ukraine. A Russian negotiator said Ukraine has proposed having a smaller and non-aligned military. Ukrainian President Volodymyr Zelenskyy will address the U.S. Congress on Wednesday.
In the U.S., the Federal Reserve has all but promised a quarter-point rate increase, with market attention focused on projections of future rate rises, comments on its balance sheet strategy and the press conference with Fed Chair Jerome Powell.
Eddy Elfenbein, portfolio manager of the AdvisorShares Focused Equity ETF, expects volatile markets to continue as long as the S&P 500 is trading below its 50-day average, which on Tuesday was 4454. “Rates are going higher and the market’s focus is changing. Since November, low volatility stocks have been back in favor. This trend will probably last for several months,” he said.
Source: This post first appeared on http://marketwatch.com/
