The lights were turned out on the stock market on Thursday, but they have been turned back on this morning. The S&P futures are up 14 points and are trading 0.5% above fair value. The Nasdaq 100 futures are up 29 points and the Dow Jones Industrial Average futures are up 126 points.
The turnabout is grounded mostly in the turn down, which is to say market participants are anticipating a bounce of some sort in the wake of some deflating action of late.
To wit, the S&P 500 has declined in five of the last seven sessions, shedding 1.3%, while the Dow Jones Industrial Average has recorded a loss in each of the last eight trading sessions, losing 3.4%. The last time the Dow ended down nine straight sessions was 1978, according to CNBC.
The Nasdaq Composite, on the other hand, was up 1.6% in the seven sessions leading up to Thursday's 0.9% decline -- a decline that is naturally being touted as a buying opportunity.
There is some headline cover, however, for the positive bias in pre-market action.
- All 35 participating bank holding companies passed the Federal Reserve's supervisory stress test, which is feeding some hope that all 35 will be increasing their capital return plans soon
- There are some press reports suggesting the U.S. and China might be exploring the possibility of holding trade talks before the July 6 drop date for tariffs and retaliatory tariffs arrives
- Oil prices ($67.14, +$1.59, +2.4%) are rising (good for energy sector earnings prospects) on reports an OPEC/non-OPEC production increase will be a less-than-feared 1.0 million barrels per day in absolute terms and reportedly closer to 600,000 in effective terms given production constraints for participating countries; and
- There was a positive bias in most Asian and European markets on the ostensible reason that there was an easing of concern about trade issues
There isn't any economic data of market-moving significance on today's economic calendar and there is a sparse amount of notable corporate news.
Shares of Red Hat (RHT) are down 14% in pre-market action after the software company reported better than expected fiscal first quarter results and issued disappointing guidance for its fiscal second quarter; CarMax (KMX) is up 9.7% after topping fiscal first quarter expectations; and UPS (UPS) is up 1.2% on the news that the company has tentatively reached a 5-year deal with the Teamsters Union, which needs to be ratified by members.
While there isn't a lot of corporate news for market participants to sink their teeth into, there will be a huge amount of stock traded today thanks to the annual rebalancing of the Russell 1000 and Russell 2000 indexes.
Entering today's trading, the Nasdaq Composite is down 0.4% for the week, the S&P 500 is down 1.1%, the Dow Jones Industrial Average is down 2.5%, and the Russell 2000 is up 0.3%.