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Dow aims to widen gains as investors await Apple event, new financial data and start of Fed meeting



U.S. equities were quoted sharply higher early Tuesday, putting stock indices on track for another session of gains as the Federal Reserve prepares to launch its two-day policy meeting and as investors await a product debut for Apple Inc. as well as a new round of financial reports.

How do stock benchmarks work?

Futures to Dow Jones Industrial Average YM00,
+ 0.71%

YMU20,
+ 0.69%
rose 194 points and reached 28,065, a gain of 0.7%, those for the S&P 500 index ES00,
+ 0.78%

ESU20,
+ 0.78%
rose 24.80 points or 0.7% to 3,397 while the Nasdaq-100 futures NQ00,
+ 1.09%

NQU20,
+ 1.08%
advanced 111.50 points or 1% to 11,378.25.

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

Russell 2000 Index RUT,
+ 2.65%
of equities with small capital rose 39.70 points or 2.7% and ended at 1,536.97, surpassing the major stock benchmarks.

What drives the market?

Shares were likely to rise early on Tuesday helped by positive economic data from China, where retail sales grew in August for the first time in 2020, up 0.5% last year, according to China’s National Bureau of Statistics.

Investors were heard on Monday of positive news about a vaccine against COVID-19 from AstraZeneca AZN,
+ 0.54%
and BioNTech BNTX,
+ 3.60%
as well as in the case of merger news involving Nvidia NVDA,
+ 5.81%
and Oracle ORCL,
+ 4.31%
and will on Tuesday see a product launch from Apple Inc. AAPL,
+ 2.99%
as well as several IPOs.

The Federal Reserve is scheduled to begin its political meeting later today, followed by a press conference and a new statement from its officials on Wednesday, while central bank decisions by the Bank of England and the Bank of Japan follow on Thursday.

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

“While other factors across the continent have helped with this positive momentum, the overwhelming factor driving the markets is the Fed,” Kapadia wrote. “Investors will look for signs of the US growth and inflation outlook and the possible reactions from the Fed,” he said.

Investors are keeping an eye on Snowflake Inc., a cloud computing company set to be listed on the New York Stock Exchange later today and backed by Warren Buffett’s Berkshire Hathaway
BRK.A,
+ 0.79%

BRK.B,
+ 0.92%
and Salesforce.com
CRM,
+ 1.45%.

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

Separate Apple Inc. AAPL,
+ 2.99%
will keep its first virtual only product unveiled at. 13 Eastern Time, where Cupertino, California, technological behemoth is expected to show off its latest smartwatch and iPads, a debut that could potentially provide a new catalyst for shares in the popular company.

Looking forward to Thursday, investors await a report on manufacturing activities 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 Eastern Time. A report on industrial production in August is expected at 9:15

Read: The IPO market takes advantage of the busiest week since May 2019 – Uber’s IPO week – with 12 offers in print

Which stocks were in focus?
  • Shares of Oracle Corp.
    ORCL,
    + 4.31%
    was in focus after the Wall Street Journal reported that the Trump administration reviewed the companies bidding to become the “strategic partner” for TikTok’s US operations, which are owned by the Chinese ByteDance.


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