(Reuters) – U.S. stock index futures rose on Tuesday after a strong October on Wall Street, as investors clung to hopes that the Federal Reserve will signal a slower pace of future interest rate hikes as economic growth slows.
The three main indexes on Monday notched their first monthly rise since July, with the blue-chip Dow recording its best month in over four decades as better-than-expected earnings and hopes of a less hawkish Fed aided the mood.
Traders widely expect the U.S. central bank to hike interest rates by 75 basis points for a fourth time on Wednesday, bringing the target overnight lending rate to a 3.75%-4.00% range. But traders are hoping that the Fed could soon pause its rate hikes or at least shift to a less aggressive stance.
The yield on benchmark 10-year Treasury notes eased on Tuesday, helping lift megacap stocks such as Amazon.com Inc, Alphabet Inc and Microsoft Corp in premarket trading.
The tech-focused group has come under pressure in the recent weeks as disappointing quarterly results pushed investors to look elsewhere such as benefited this year.
U.S. President Joe Biden on Monday called on oil and gas companies to use their record profits to lower costs for Americans and increase production, or pay a higher tax rate.
U.S.-listed shares of Chinese firms such as JD.Com, Alibaba Group Holding and Pinduoduo jumped about 7% with rumors circulating on social media that China was planning a reopening from strict COVID curbs in March.
At 05:46 a.m. ET, Dow e-minis were up 190 points, or 0.58%, S&P 500 e-minis were up 32 points, or 0.82%, and Nasdaq 100 e-minis were up 119.75 points, or 1.05%.
In economic data, the Institute for Supply Management’s (ISM) survey, due at 10 a.m. ET, is expected to show manufacturing PMI fell to 50 last month after declining to 50.9 in September.
(Reporting by Sruthi Shankar and Amruta Khandekar in Bengaluru; Editing by Saumyadeb Chakrabarty)