Stock Futures Rise Ahead of Consumer Confidence Data


U.S. stock futures rose and government bond yields ticked lower, a sign that a selloff in the last two sessions could pause, as investors awaited data on consumer confidence, home prices and job openings.

Futures for the S&P 500 gained 0.9% Tuesday. Contracts for the tech-focused Nasdaq-100 added 1.2% and futures for the Dow Jones Industrial Average rose 0.7%. 

Stocks fell in the last two trading sessions after Federal Reserve Chairman

Jerome Powell

said the central bank must continue raising interest rates and hold them at a higher level until it is confident inflation is under control. This ran contrary to some investors’ prior expectations that the Fed would ease the pace of rate increases due to worsening economic data and easing inflation figures.

Those comments led investors to bet on another aggressive rate increase at the September meeting. Futures bets show that traders see a roughly 68.5% probability that the Fed will raise interest rates by another 0.75 percentage point at its next meeting, according to

CME Group.

Investors tend to sell stocks and government bonds when financial conditions are tightening. 

Tuesday’s optimism may reflect some investors’ desire to scoop up stocks made cheaper from the recent market decline. Summer vacation also typically leads to fewer traders buying and selling, meaning that price movements can be more volatile. 

“Every time you have a big decline in markets you want to buy the dip. It’s psychological. Nothing has changed between yesterday and today,” said

Luca Paolini,

chief strategist at Pictet Asset Management. “A light day of trading in August doesn’t tell you much about the market except that there are always buyers.” 

The yield on the two-year Treasury note, which is more sensitive to near-term Fed policy expectations, ticked down to 3.411% from 3.427% Monday. The yield on the benchmark 10-year Treasury note ticked down to 3.065% from 3.109% Monday. Yields fall when prices rise. 

The S&P CoreLogic Case-Shiller National Home Price Index, due at 9 a.m. ET, will show home-price trends at the end of the second quarter. Economists surveyed by The Wall Street Journal expect the index to have risen at a slower pace in the year ended in June, compared with the month before.

The Conference Board’s consumer-confidence index, which measures American attitudes toward jobs and the economy, is estimated to have increased in August. Data are due at 10 a.m. The Labor Department will release July data on job openings, quitting, hiring and layoffs also at 10 a.m. Openings declined for the third consecutive month in June, but still remained historically elevated.

Earnings are due ahead of the market open from

Best Buy.

CrowdStrike Holdings

and

Chewy

will report quarterly results after the market close. 

Traders worked on the floor of the New York Stock Exchange on Monday.



Photo:

Michael M. Santiago/Getty Images

In energy markets, Brent crude, the international benchmark for oil prices, fell 1.9% to $100.92 a barrel. Benchmark European natural-gas futures fell 6.1% to €256 a megawatt hour as the EU appears on the cusp of filling its gas storage to levels that could be enough to get it through the winter, even without Russian supplies.  

The WSJ Dollar Index, which measures the dollar against a basket of 16 currencies, weakened by 0.4%, with currencies like the euro and the British pound gaining against the greenback. Bitcoin, the world’s largest cryptocurrency by market value, edged higher, trading above $20,000 after briefly falling below that Monday.  

Overseas, the pan-continental Stoxx Europe 600 rose, led by gains in the technology sector. Major indexes in Asia were mixed, with China’s Shanghai Composite and Hong Kong’s Hang Seng each declining less than 0.5%. South Korea’s Kospi added 1%, and Japan’s Nikkei 225 rose 1.1%.

Write to Caitlin Ostroff at caitlin.ostroff@wsj.com

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