U.S. stock futures inched up in overnight trading on Tuesday as investors prepare for another round of corporate earnings.

Dow futures rose about 70 points. S&P 500 futures gained 0.25% and Nasdaq 100 futures rose 0.27%.

Chipotle rose more than 7% in after-hours trading on the back of its strong earnings, while Lyft ticked lower after announcing it had fewer active riders than in the prior quarter.

On Tuesday, the Dow Jones Industrial Average added more than 370 points, helped by a 7.8% pop in Amgen on the back of its strong earnings report. The S&P 500 also registered a gain, climbing 0.8%. The technology-focused Nasdaq Composite rose 1.3%.

A handful of strong corporate earnings boosted sentiment on Tuesday, after a slow start to the week. Harley-Davidson, Chegg, DuPont and Centene all rose after reporting better-than-expected earnings.

As of the closing bell on Tuesday, nearly 60% of all S&P 500 companies have reported fourth-quarter earnings and roughly 77% have topped Wall Street’s earnings estimates, according to FactSet.

“We are wrapping up a very solid earnings season,” said Ryan Detrick of LPL Financial. “Sure, we had a high profile blowup at Facebook, but overall we’ve seen impressive news from corporate America.”

High-interest earnings reports on Wednesday include CVS Health, Fox Corp., GlaxoSmithKline and Yum Brands before the bell. Disney, Mattel, MGM Resorts and Uber Technologies will release results after the bell on Wednesday.

Investors are also preparing for Thursday’s Consumer Price Index report, which should give an update on the inflation picture. The Federal Reserve has already broadcasted a monetary policy pivot in order to address the historically high price increases.

The CPI report “has had a big bullseye on it all week and the truth is that headline number will likely be one of the highest we’ve ever seen,” said Detrick. “Now the good news is we are likely close to a major peak in inflation and this number very well could be the peak. We’ve seen some improvements in supply chains lately and this is the first clue we are nearing a peak in inflation as well.”

The inflation data is estimated to show that prices rose 0.4% in January, for a 7.2% gain from one year ago, according to Dow Jones.

(SOURCE)

Stock Futures

Stock futures are financial derivatives that allow investors to speculate on the future price of a stock or a set of stocks. Here are some key points:

1. Definition: Futures contracts are agreements to buy or sell an asset (in this case, stocks) at a predetermined future date and price. These contracts derive their value from changes in the price of the underlying asset.
2. Underlying Assets: Stock market futures are typically based on major stock market indexes, such as:
   • Dow Jones Industrial Average (DJIA): Represents 30 large publicly traded companies in the United States.
   • S&P 500: Includes 500 of the largest publicly traded companies in the U.S.
   • Nasdaq 100: Comprises 100 non-financial companies listed on the Nasdaq stock exchange.
3. Investment Strategy: Investing in stock futures involves betting on the future value of the index. Traders can take long (buy) or short (sell) positions based on their expectations of market movements.
4. Expiration Date: Like options, futures contracts have an expiration date. Traders need to settle the contract by either buying or selling the underlying asset before the specified date.
5. Risk and Leverage: Futures trading can be highly leveraged, meaning that a small investment can control a larger position. However, this also increases the risk.
6. Market Hours: Futures markets operate outside regular stock market hours. Pre-market trading allows investors to react to news and events before the official market open.

Stock futures inch lower as investors review earnings, brace for inflation report: Live updates