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Stock-index futures pointed to a flat to slightly higher start for Wall Street Wednesday ahead of the last full trading day of a holiday-shortened week, building on a record finish for major indexes as investors remain upbeat about prospects for a partial U.S.-China trade deal.
Stocks remained near unchanged after an initial deluge of U.S. economic data, including an upward revision to third-quarter gross domestic product growth.
What are major indexes doing?
Futures on the Dow Jones Industrial Average YMZ19, +0.00% rose 4 points, or less than 0.1%, to 28,134, while S&P 500 futures ESZ19, +0.07% were up 4.05 points, or 0.1%, at 3,147.75. Nasdaq-100 futures NQZ19, +0.15% gained 18.50 points, or 0.2%, to trade at 8,419.25.
U.S. financial markets will be closed Thursday for Thanksgiving Day and will see an abbreviated trading schedule on Friday.
Read: When do markets close for Thanksgiving?
On Tuesday, the Dow DJIA, +0.20% rose 55.21 points, or 0.2%, to end at 28,121.68, while the S&P 500 SPX, +0.22% advanced 6.88 points, or 0.2%, to finish at 3,140.52. The Nasdaq COMP, +0.18% closed at 8,647.93, a gain of 15.44 points, or 0.2%. The performance marked the 10th record close of the month for all three major indexes.
What’s driving the market?
The positive tone for equities this week has been attributed in large part to upbeat expectations around trade. President Donald Trump on Tuesday said U.S.-China negotiations were in the “final throes,” while China’s Commerce Ministry said Vice Premier Liu He, the country’s top trade negotiator, spoke with U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin.
But some analysts worry investors have gotten carried away, leaving the market vulnerable to a pullback in the case of another trade-related setback or even if an agreement is reached in the near term.
See: Beware stock-market ‘FOMO’ as Wall Street churns out record highs, says long-term bull
“Looking ahead, extra caution may be warranted. With markets having broken new records again and again on signals that this phase one deal is drawing closer, it’s fruitful to ask how much upside – if any – there’s still in store once that agreement is officially completed,” said Marios Hadjikyriacos, investment analyst at XM, in a note.
“Is a phase one deal practically priced in by now, and are we therefore looking at a potential ‘buy the rumor sell the fact’ reaction once it’s wrapped up?” he asked.
Also read: Stock-market optimism gauge hits an extreme — and that explains a lot, analyst says
Investors were wading through a heavy round of economic data, including a revised estimate of third-quarter GDP that showed the U.S. economy expanded at a 2.1% annual pace versus a previous estimate of 1.9%.
Separately, the number of people who applied for first-time unemployment benefits fell sharply in the week before Thanksgiving, putting claims back near historic lows. Initial claims declined 15,000 to 213,000 in the week ended Nov. 23, the Labor Department said.
Also, orders for durable goods rose 0.6% in October, the government said, defying forecasts for a 1.1% drop, though most of the gain was tied to defense-related goods such as jet fighters and ships.
The November Chicago-area purchasing managers index is due at 9:45 a.m. Eastern, while October personal income and spending data is up for release at 10 a.m. Eastern. A pending home sales index for October is also due at that time, while the Fed’s “Beige Book” compilation of anecdotal economic information from across the country is set for release at 2 p.m. Eastern.
Which companies are in focus?
Deere & Co. DE, +0.02% shares fell 4.8% in premarket activity after the farm-equipment maker early Wednesday issued a profit warning for fiscal 2020 that it said reflected uncertainty in its equipment business.
Shares of Dell Technologies Inc. DELL, -3.40% were off 2.9% ahead of the bell after the PC manufacturer cut its revenue guidance late Tuesday and cited a shortage of chips from Intel Corp. INTC, +0.15%.
Shares of VMware Inc. VMW, -2.27% were expected to be in focus after the software company reported better than expected earnings Tuesday evening, while swallowing former partners Pivotal Software and Carbon Black. Shares were up 2.4% in premarket action.
Shares of HP Inc. HPQ, -0.45% were 1.2% higher in premarket trade, after the computing giant reported a modest bump in fourth-quarter revenue, while offering improved earnings guidance.
Box Inc. BOX, +1.40% shares rose 2.1% in premarket action, after the enterprise-software company late Tuesday reported stronger-than-expected quarterly revenue.
Computer-assisted-design software maker Autodesk Inc. ADSK, +1.14% reported better-than-expected profit and revenue after Tuesday’s close. Shares were off 0.5% in premarket action.
In other markets
U.S. Treasury yields rose after the better-than-expected U.S. economic data early Wednesday with the benchmark 10-year yield TMUBMUSD10Y, +1.18% up to 1.765%.
Gold prices fell after the better-than-expected U.S. economic data early Wednesday with December gold $5.70 or 0.4% at $1,454.60 an ounce.
