U.S. stock index futures were flat during early morning trading on Wednesday, after the S&P 500 closed shy of a new record on Tuesday.
Futures contracts tied to the Dow Jones Industrial Average advanced just 27 points. S&P 500 futures and Nasdaq 100 futures were both little changed.
All three major averages finished Tuesday’s session in the green, reversing losses from earlier in the session amid strength in the technology sector.
The S&P 500 advanced 0.5%, to close just 0.2% away from a fresh all-time closing high. The Dow rose 163 points after earlier in the session falling more than 120 points. The Nasdaq Composite was the relative outperformer, hitting a new intraday all-time high and posting a 0.8% gain on the session for a new record close.
Federal Reserve Chairman Jerome Powell testified before the House of Representatives on Tuesday, which appeared to lift sentiment as he reiterated that inflation pressures will be temporary.
“Powell outlined how the inflation overshoot is from categories directly affected by reopening,” said Ed Moya, senior market analyst at Oanda. “He noted there is extremely strong demand and that the supply has been caught flat-footed.”
In prepared remarks released Monday evening, the central bank chief reiterated that the economy is growing, although the threat of the pandemic is still present.
For June the S&P 500 and Nasdaq Composite are in the green, rising 1% and 3.6%, respectively. The Dow, however, is in the red for the month amid weakness in Caterpillar and JPMorgan.
Looking ahead, UBS said it maintains a “positive tactical view on stocks,” but that gains will be unevenly distributed.
“We see potential in regional markets that lagged in the second quarter, particularly China and Japan, as well as among those companies and sectors most exposed to economic reopening, including energy, financials, and US small- and mid-caps,” the firm wrote in a recent note to clients. UBS said investors should take profits in some of the year-to-date winners that might have limited upside ahead, including real estate, consumer discretionary and industrial names.
Bitcoin posted another volatile session on Tuesday, with the cryptocurrency at one point dipping below $30,000 and erasing its gains for 2021. But bitcoin ultimately recouped all of the more than 11% loss and finished the session in positive territory, according to data from Coin Metrics.
Earnings season has mostly finished, but Winnebago is set to report quarterly results before the opening bell on Wednesday, while KB Home will post results when the market closes.
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