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Recession fears have gripped Wall Street on concerns that
economic growth and corporate profits could come under pressure
from rising interest rates, the Ukraine war and the prolonged
supply chain problems.
The S&P 500 last week confirmed a bear market, clocking a more
than 20% loss from its January closing peak as the Fed pushed
ahead with its largest interest rate hike in nearly three
decades. The tech-heavy Nasdaq has shed more than 31% from its
November peak.
In the previous session, U.S. stock indexes ended with slim
losses after Fed Chair Jerome Powell said the central bank is
not trying to engineer a recession but is fully committed to
bringing prices under control even if doing so risks an economic
downturn.
His second day of testimony before the House Financial Services
Committee is at 10 a.m. ET (1400 GMT). Money markets are pricing
in 75 basis point (bps) increase in rates next month, followed
by a 50 basis point rise in September.
Weekly jobless claims report is due at 08:30 a.m. ET. The S&P
Global's Composite PMI survey for June will be published after
the market opens. Similar surveys from earlier in the day showed
manufacturing growth is slowing from Asia to Europe as surging
inflation dents global economic outlook.
Meanwhile, the Fed is set to release the results of its 2022
stress test, which will assess how much capital banks would need
to withstand a severe economic downturn. Shares of big banks
slipped in premarket trading, with Wells Fargo down 0.2%.
At 06:54 a.m. ET, Dow e-minis were up 141 points, or 0.46%, S&P
500 e-minis were up 27.25 points, or 0.72%, and Nasdaq 100
e-minis were up 125.5 points, or 1.09%.
Tesla Inc rose 2% and Nvidia Corp 1.5% to lead gains among the
growth and technology companies as Treasury yields pulled back.
Occidental Petroleum Corp gained 3.3% after Warren Buffett's
Berkshire Hathaway Inc bought another 9.6 million shares of the
oil company, boosting its stake to 16.3%.
Snowflake Inc climbed 5.1% after J.P. Morgan upgraded the cloud
software company's stock to "overweight" from "neutral".
(Reporting by Devik Jain in Bengaluru; Editing by Arun Koyyur)
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