By Peter Nurse
Investing.com - U.S. stocks are seen opening firmly higher Tuesday, continuing the recent positive tone as investors cheer the greater clarity of political transition in Washington, the nomination of Janet Yellen as Treasury Secretary as well as the continuing progress of Covid-19 vaccines through the development process.
At 7:05 AM ET (1205 GMT), the Dow Futures contract rose 284 points, or 1%, while S&P 500 Futures traded 25 points, or 0.7%, higher, and Nasdaq 100 Futures climbed 36 points, or 0.3%.
Helping the tone Tuesday was the announcement Monday that General Services Administration chief Emily Murphy informed President-elect Joe Biden that federal resources would be available for his transition into office, three weeks after the actual election.
President Trump backed the decision, and while he didn’t go as far as to concede the election, this move has removed a lot of the uncertainty over whether there would be an orderly transfer of power in the world's biggest economy.
Wall Street has also cheered the news Biden is to nominate former Federal Reserve Chair Janet Yellen as his Treasury Secretary, seeing her as willing to complement the current Fed policy of very low interest rates with extended, expansionary government spending to support the economy through the pandemic.
At least 150,000 Covid-19 cases are being confirmed each day in the U.S., with many states instigating new restrictions to try and slow down this new surge in infections.
On Monday, the Dow Jones Industrial Average closed 327 points, or 1.1%, higher, while the S&P 500 gained 0.6% and the Nasdaq Composite 0.2%. The DJIA is on track to have its best month since January of 1987, as the idea of Covid-19 vaccines in the near future has tempted investors back into pro-growth cyclical stocks.
There are a few more retailers due to report earnings Tuesday as the sector heads into its critical holiday shopping season, including Best Buy (NYSE:BBY), Dick’s Sporting Goods (NYSE:DKS), Dollar Tree (NASDAQ:DLTR) and Tiffany & Co (NYSE:TIF).
On the economic data slate, September data from the S&P/Case-Shiller Home Price index is due later in the session, followed by November figures from the Conference Board's Consumer Confidence survey.
Oil prices continued to post gains Tuesday, climbing to levels not seen since March. Traders will look to the release of the crude oil supply data from the American Petroleum Institute later in the day.
U.S. crude futures traded 0.8% higher at $43.40 a barrel, while the international benchmark Brent contract rose 0.6% to $46.31. Both oil benchmarks settled up about 2% on Monday after gaining about 5% last week.
Elsewhere, gold futures fell 0.9% to $1,809.75/oz, dropping to its lowest level in four months, while EUR/USD traded 0.3% higher at 1.1869.