Stock futures are flat after major averages turn positive for the week

U.S. stock index futures were flat in overnight trading on Wednesday, after major averages advanced during regular trading to turn positive for the week.

Futures contracts linked to the Dow Jones Industrial Average gained 27 points. The S&P 500 and Nasdaq 100 futures were slightly higher.

During the session, the Dow Jones gained 286 points, or 0.83%, while the S&P climbed 0.82%. The Nasdaq Composite was the relative outperformer, up 0.92%. Energy was the best performing S&P group, advancing 3.5% on the rebound in oil prices.

Wednesday’s gains built on Tuesday’s strong session, and major averages have now erased Monday’s liquidation losses. The Dow Jones fell more than 700 points to start the week as rising Covid cases around the world hit sentiment. The 10-year Treasury yield fell to a five-month low of 1.17% earlier in the week, which also prompted investors to shed stocks. On Wednesday, the 10-year yield rose 8 basis points to 1.29%.

“The truth is that investors have been very spoiled by the recent stock market performance,” noted Ryan Detrick, chief financial markets strategist at LPL Financial. “Incredibly, we haven’t seen a 5% drop since October. While we firmly believe this bull market is alive and well, let’s not kid ourselves by thinking that trees grow forever. The risk is definitely increasing as we head into the tough August and September. “

A busy week of earnings will continue on Thursday. AT&T, DR Horton, Southwest Air, American Airlines, Abbott Labs, and Union Pacific are among the names on the deck before the opening bell. Intel, Twitter, Snap and Capital One will release quarterly updates after the market closes.

So far, 15% of the S&P 500 have declared profit, with 88% exceeding profit estimates, according to Refinitiv. Of the companies that reported, 84% exceeded revenue expectations.

Investors will also monitor the number of weekly unemployment claims from the Labor Ministry on Thursday. Economists polled by Dow Jones expect the number of first deposits to be 350,000, down from the previous reading of 360,000. Sales figures for existing homes will also be released.

“We expect a continuation of botched trading during the seasonally weak summer months; however, our baseline scenario remains that the main trend over the next 12 months remains up,” wrote Keith Lerner, chief strategist. contracts at Truist, in a note to clients. “The S&P 500, which just hit a new record last week, had one of the longest stretches of the past decade without a 5% decline,” he added.