U.S. stock futures rose slightly in Tuesday morning trading after a strong market recovery, with Reddit’s trading craze continuing to unfold.
Dow futures rose 60 points. S&P 500 futures gained 0.4% and Nasdaq 100 futures rose 0.4%.
The strong gains from Amazon and Alphabet helped futures. Amazon reported earnings nearly double Wall Street estimates; however, stock movement was tempered by the news that Jeff Bezos would step down as CEO.
Alphabet’s shares gained 6% on the floor after hours, after the tech giant reported 23% revenue growth and exceeded profit estimates.
Shares rose for the second day on Tuesday, with the Dow Jones Industrial Average gaining more than 475 points on its best day since November. Investors resumed buying shares after the Reddit-driven action that rocked the markets last week. The Dow was up 2.35% this week.
The S&P 500 was up 1.4% and the Nasdaq Composite was up more than 1.5%.
After a meteoric, though apparently synthetic, rise in GameStop last week, caused by a slight squeeze, stocks plunged more than 70% this week. Other negotiations with Reddit also returned to Earth amid trade restrictions from major brokerage firms.
“The best way to describe the current stock market action is to ‘reverse the Reddit revolution,” said Jim Paulsen, chief investment strategist at Leuthold Group, to CNBC. “What happened to GameStop came with GameStop.”
“From midday on January 28th to the end of January 29th, cyclicals, including technology, were hit while the defensive sectors overcame the pace. In the past two days, and particularly today, this has been reversed,” added Paulsen.
Investors are also monitoring negotiations in Washington around another stimulus package. President Joe Biden met with the 10 Republican senators on Monday to discuss an alternative proposal for minor aid for his $ 1.9 trillion package.
The earnings season continues on Wednesday with AbbVie, Biogen, Boston Scientific, GlaxoSmithKline and Humana reporting ahead of the opening bell.
Chipmaker Qualcomm, eBay, PayPal and Yum China report profits after the market closed on Wednesday.
The January private payroll data is released at 8:15 am on Wednesday by ADP. Economists polled by Dow Jones expect jobs in the private sector to grow by 50,000 in January, compared to a loss of 123,000 in December.
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