U.S. stock futures ticked slightly lower early Tuesday morning ahead of the first presidential debate.
Futures for the Dow Jones Industrial Average dipped 86 points. Contracts for the S&P 500 and the Nasdaq Composite also traded in mildly negative territory.
The quiet move in futures follows a solid start to the week for stocks during Monday’s session, with the Dow rising 410 points, or 1.5%. The S&P 500 and Nasdaq rose 1.6% and 1.9%, respectively.
Monday’s rally set up the market to snap losing streaks. The Dow and the S&P 500 have fallen for four consecutive weeks. The Nasdaq Composite managed to break its own three-week streak with a 1% gain last week.
David Waddell, CEO of wealth strategist firm Waddell & Associates, said that he saw recent weakness for the market as a needed “comeuppance” for major tech stocks and that stocks were set for near-term volatility while the indexes treaded water.
“I think we’re in a sideways period. It’s just we’re going to do it like we’re on a trampoline,” Waddell said. The strategist also said his clients still had a large amount of their assets in cash, suggesting potential support for the market.
Political news is poised to potentially be a major driver of market news this week, with the first debate between President Donald Trump and Democratic nominee Joe Biden set for Tuesday night. Some Wall Street analysts believe the first debate of this cycle could be more consequential for the markets than most debates, with a clear victory by one candidate possibly creating significant market moves.
House Speaker Nancy Pelosi said on Monday night that the Democrats were unveiling a new $2.2 trillion stimulus package, smaller than the more than $3 trillion proposed earlier in the crisis but still well above what Republican leaders have offered. The new bill would include enhanced unemployment benefits and aid to airlines and state and local governments, according to a summary.
The climb for stocks on Monday came after mixed news about the coronavirus response over the weekend. On the bullish side for the market, Florida lifted capacity restrictions on restaurants over the weekend and Pelosi said she believed another relief bill was still on the table.
However, cases in the U.S. continued to rise once again, with Dr. Anthony Fauci saying on Monday that the U.S. is “not in a good place” as colder weather approaches.
Before the debate kicks off, investors will get a close look at the state of the semiconductor industry when Micron reports its fiscal fourth quarter results after the bell on Tuesday. The stock gained 1.2% on Monday despite receiving a “negative catalyst watch” from Citi.
Don’t miss CNBC and Institutional Investor’s Delivering Alpha conference on September 30, featuring Treasury Secretary Steven Mnuchin, Senator Elizabeth Warren, Alibaba’s Joseph Tsai, Vista Equity Partners’ Robert Smith, J.P. Morgan’s Mary Callahan Erdoes, Inclusive Capital’s Jeff Ubben and more.