NEW YORK: Wall Street was on track to open higher on Monday, recovering from last week’s trade tariff driven selloff, after officials of the Trump administration stressed the dispute with China could be resolved through talks.
The week also marks the start of earning season with big US banks such as JPMorgan Chase, Citigroup and Wells Fargo set to report first-quarter results on Friday.
Investors expect tax cuts to help corporate America show its biggest quarterly profit growth in seven years.
Global markets came under pressure last week as the United States and China threatened each other with tens of billions worth of tariffs. Investors remained on edge as they feared protectionist measures would hit global economic growth.
US stocks dropped about 2 percent on Friday, with the Dow falling more than 570 points on trade war fears.
But Trump’s Chief Economic Adviser Larry Kudlow said in an interview on Sunday the ongoing spat “might turn out to be very benign”.
Trump echoed Kudlow’s sentiment in a Twitter post that said any tariffs would be reciprocal and that he saw a “Great future for both countries!”
“One of the reasons why we’re seeing quite a strong rally at the opening is that the administration over the weekend including Mr Trump basically tried to deflate the fears of a trade war,” said Peter Cardillo, chief market economist at First Standard Financial in New York.
“It appears the market has entered into a trading range and is basically fluctuating ahead of the earnings season.”
At 8:44 a.m. EDT, Dow e-minis were up 143 points, or 0.6 percent, with 54,694 contracts changing hands. S&P 500 e-minis were up 11.75 points, or 0.45 percent, with 201,523 contracts traded.
Nasdaq 100 e-minis were up 40.25 points, or 0.62 percent, on volume of 64,626 contracts.
AveXis stock was among the top 25 most active stocks in premarket trading. Shares of the gene therapy company rose nearly 82 percent after Swiss drugmaker Novartis offered to buy it for $8.7 billion.
Merck’s shares rose 2.3 percent after the drugmaker’s blockbuster cancer drug, Keytruda, met the main study goal of helping previously untreated lung cancer patients live longer.
Shares of Leucadia National climbed 12 percent premarket after the company said it would sell most of its non-financial assets to focus on investment banking and capital market businesses.
General Motors was up 2.1 percent premarket after Morgan Stanley raised it to “overweight”.
Source: Brecorder
