By Peter Nurse
Investing.com - U.S. stocks are set to edge higher at the open Tuesday, barely rebounding from Monday’s crash following promises of action from the leaders of the world’s advanced economies. Confidence remains weak with investors fearing the coronavirus pandemic will cause a protracted economic slowdown.
At 7:20 AM ET (1120 GMT), the S&P 500 Futures traded 33 points, or 1.4%, higher, the Nasdaq 100 Futures contract was up 156 points, or 2.2%, while the Dow Jones 30 Futures contract rose 265 points, or 1.2%.
Leaders from the Group of Seven countries issued a statement promising to “do whatever it takes” to tackle the health and economic risks from the coronavirus outbreak following a conference call late Monday.
This has somewhat helped the tone following Wall Street's steepest fall since 1987 on Monday, when U.S. President Donald Trump warned that the Covid-19 outbreak could last through August and possibly tip the U.S. economy into recession.
The three indices have plunged about 30% from their record closing highs hit in mid-February and ended the U.S. stock market's record 11-year bull run.
In corporate news, U.S. airlines have approached the federal government with a request for $50 billion in financial assistance, plus tax relief, as they struggle with a crisis that threatens to eclipse even the period after the 9/11 attacks.
Airlines for America, the industry association, said on its website it has asked for grants of up to $25 billion and loans of up to another $25 billion. According to Bloomberg, the industry spent 96% of its free cash flow over the last decade on stock buybacks, rather than building financial reserves.
Additionally, Uber Technologies (NYSE:UBER) Tuesday began suspending shared rides on its ride-hailing platform in the United States and Canada to limit the spread of the coronavirus.
There are a number of economic releases for February due later Tuesday, including retail sales at 8:30 AM ET and industrial production at 9:15 AM ET, but these numbers are unlikely to have much of an impact given that they predate the outbreak's impact on U.S. society.
Elsewhere, the oil market has turned positive, but gains are still limited in view of the hit to demand from the virus-induced economic slowdown and a price war between Saudia Arabia and Russia.
The API weekly crude oil stocks data are due after the close at 4:30 PM ET.
AT 7:20 AM ET, U.S. crude futures traded 2.5% higher at $29.71 a barrel. The international benchmark Brent contract rose 1.0% to $30.34.
Additionally, gold futures fell 1.0% to $1,471.25/oz, while EUR/USD traded at $1.1009, down 1.5%.