Wall Street stock futures nudged higher on Tuesday amid growing hopes the Federal Reserve is done with interest-rate hikes for now, but with investors still cautious as the Middle East conflict escalated.
Dow Jones Industrial Average (^DJI) futures were up almost 0.2%, or almost 60 points, while S&P 500 (^GSPC) futures gained about 0.1%. Contracts on the tech-heavy Nasdaq 100 (^NDX) were also up around 0.1%, after the stock indexes reversed losses to close higher on Monday.
The gains came after dovish comments from two Fed officials, which signaled that the recent surge in bond yields could lead to the tightening in credit conditions the central bank is looking for. That could give policymakers a reason to call an end to raising rates in this cycle, some analysts believe.
Read more: What the Fed rate-hike pause means for bank accounts, CDs, loans, and credit cards
But the IMF has warned that monetary policy needs to remain tight in most places, as central banks are “not quite there” on bringing tenacious inflation down toward targets.
Easing some pressure on stocks, yields on Treasuries dropped as trading reopened on Tuesday after closing for a holiday. The 10-year Treasury (^TNX) yield came off its 16-year peak even as investors kept watch on the clashes between Islamist militant group Hamas and Israel, which has vowed to put the Gaza strip under siege.
In another sign of easing worries, oil prices fell after gaining more than 4% as investors eyed potential supply disruptions from the Middle East conflict.
KStock futures inch up as hopes for Fed pause rise
The major stock indexes were poised to open in the green on Tuesday as investors focused on dovish comments from Federal Reserve officials, but kept one eye on developments in the Middle East conflict.
Futures on the Dow Jones Industrial Average (^DJI) added 0.17%, or 58 points, while S&P 500 (^GSPC) futures rose 0.11%. Contracts on the tech-heavy Nasdaq 100 were up 0.12%.
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