Stock futures higher as bargain hunting begins after Brexit

[June 28, 2016]  By Yashaswini Swamynathan

(Reuters) - U.S. stock index futures rose sharply on Tuesday as investors rushed to pick up Brexit-hit stocks after Wall Street crumbled under fear and uncertainty to its worst two-day fall in 10 months.

Banks, which were the worst hit since Britain voted to leave the European Union on Thursday, were among the most attractive stocks for bargain hunters.

Morgan Stanley rose 2.5 percent to $24.20 in premarket trading, while Bank of America and Citigroup rose about 2 percent.

Global equities went into a free fall on Friday after the vote as investors unsure of its consequences sought shelter in safe havens such as gold and the Japanese yen.

Wall Street closed lower on Monday with all three indexes lower for the year.

A rebound in oil prices on Tuesday signaled an appetite for riskier assets, while gold lost its two-day shine and fell 1.1 percent. [O/R]

Battered European shares rose 2.4 percent after having dropped more than 10 percent on Friday.

While investors do not expect the U.S. Federal Reserve to raise short-term interest rates anytime this year, they will keep an eye on economic data that can steer the Fed's sentiment.

The U.S. Commerce Department is expected to release its third estimate of first-quarter gross domestic product, which is likely to have increased 1 percent, compared with the previous reading of 0.8 percent. The report is scheduled for release at 8:30 a.m. ET (1230 GMT).

Consumer confidence is expected to have risen to 93.3 in June from 92.6 in May. The data is expected at 10:00 a.m. ET (1400 GMT).
 

Specialist traders work inside a post on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., June 27, 2016. REUTERS/Brendan McDermid

Technology stocks, which were also hard hit by Brexit, fought back on Tuesday. Apple <AAPL.O> and Amazon.com  were both up about 1 percent. Micron  rose 2.1 percent and was the biggest percentage gainer among S&P components.

Futures snapshot at 7:14 a.m. ET:

Dow e-minis  were up 179 points, or 1.05 percent, with 39,627 contracts changing hands.

S&P 500 e-minis were up 19.5 points, or 0.98 percent, with 262,272 contracts traded.

Nasdaq 100 e-minis were up 42.5 points, or 1.02 percent, on volume of 30,814 contracts.

(Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Don Sebastian)

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