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Jan 4, 2017

U.S. Stock Market Future Indications on January 4, 2017: U.S. Stocks Rally Set To Continue With FOMC Minutes Ahead


Sara Sjolin


U.S. stocks were set for another day of gains on Wednesday, with the Dow average inching closer to the closely watched 20,000 level as bank stocks continued to rise.

Data on monthly car sales and minutes from the latest Federal Reserve meeting could also help drive trading action later in the day.
Futures for Dow Jones Industrial Average YMH7, +0.14%  rose 29 points, or 0.2%, to 19,927, while those for the S&P 500 index ESH7, +0.16%  added 3.65 points, or 0.2%, to 2,256.25. Futures for the Nasdaq-100 index NQH7, +0.14%  gained 8.75 points, or 0.2%, to 4,914.75.
On Tuesday, all three benchmarks ended in positive territory, with the Dow average DJIA, +0.60%  adding 119.16 points to end at 19,881.76.
“The Dow continues to sit tantalizingly close to that psychological 20,000 level, but the appetite to push higher still seems lacking,” said Remo Fritschi, institutional sales manager at ADS Securities, in a note.
“A soaring U.S. dollar and more signs that U.S. corporates are going to find themselves facing very different priorities under the Trump administration — as seen by the threat of hefty import duties on cars made in Mexico — certainly seems sufficient justification for holding off from one final push, although [Wednesday’s] FOMC meeting minutes could well prove to be defining,” he added.
Read: Trump can bully car makers, but he can’t buck economics, says Rex Nutting
Minutes from the Federal Open Market Committee’s Dec. 13-14 meeting are due at 2 p.m. Eastern Time. At the meeting, the central bank lifted interest rates as expected, but hinted at more hikes in 2017 than analysts had forecast.
“The market will be looking for clues as to how the Fed will respond to the new administration — and the fiscal challenges this is likely to bring — whilst anything that softens the hawkish narrative we saw painted in Janet Yellen’s speech last month could also give equities that much needed shot in the arm,” Fritschi said.
Auto sales for December were also slated to trickle out through the trading day on Wednesday.
Movers and shakers: Banks continued their push higher, with shares of J.P. Morgan Chase & Co. JPM, +1.09%  up 0.6% ahead of the bell, and Morgan Stanley MS, +1.89%  and Bank of America Corp. BAC, +1.95%  each rising 0.4%.
Shares of Agile Therapeutics Inc. AGRX, -12.28%  sank 71% in premarket trade. The women’s health company late Tuesday reported positive results in a study of its Twirla contraceptive patch, but said 51.4% of participants had to discontinue the study.
Tesla Motors Inc. TSLA, +1.54%  lost 2.6% before the bell after the electric car maker late Tuesday reported on production challenges in the fourth quarter. Startup Faraday Future unveiled an all-electric rival to Tesla’s range at the CES technology trade show on Tuesday.
See: Nvidia, after monster 2016, enters spotlight at CES
Mastercard Inc. MA, +2.07%  could also move after the U.K. Competition and Markets Authority said it’s concerned that Mastercard’s acquisition of VocaLink gives rise to competition concerns.
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Other markets: Asian markets closed mostly higher, with Japan’s Nikkei 225 index NIK, +2.51%  jumping to a 13-month high.
The mood was more subdued in Europe, where markets struggled for direction, a day after the Stoxx Europe 600 index SXXP, -0.11%  entered bull-market territory.
Oil CLG7, +0.52%  and gold GCG7, +0.38%  prices advanced, while the dollar DXY, -0.25% pulled back from a 14-year high reached on Tuesday