Stock Futures Grind Higher Ahead as Yellen Testimony Emerges
NEW YORK (TheStreet) -- Stock futures were trading higher Tuesday morning as Federal Reserve Chairwoman Janet Yellen, in prepared testimony released before her meeting with the House Financial Service Committee, said the central bank would continue scaling back its economic stimulus program at a measured pace in expectation of ongoing improvements in the labor market.
Futures for the S&P 500 were gaining 0.21% 1,798.5. Futures for the Dow Jones Industrial Average were adding 0.24%, to 15,777 while Nasdaq futures were climbing 0.31% to 3,588.75.
Yellen said in her prepared testimony that a reduction in its monetary stimulus program is not on a preset course, and added that it would remain contingent on the labor market and inflation.
Major U.S. equity markets closed little changed on Monday as investors were content to pause until Yellen offered any hints of how the Fed expects to act in the coming months. The Labor Department last Friday reported a weaker-than-expected monthly jobs report, making it the second soft monthly labor report in as many months. Despite recent worries about monthly jobs reports, Yellen's comments don't suggest that the Fed believes this is a trend -- at least not yet.
"Too many Americans remain unemployed, inflation remains below our longer-run objective, and the work of making the financial system more robust has not yet been completed," Yellen is expected to say in prepared remarks at 10 a.m. EST.
"Stock futures continued to gain after Yellen reaffirmed that she would follow the plan set in place by Bernanke and paid little attention to the recent problems with emerging markets," Phil Streible, senior market strategist at RJO Futures, wrote in an email.The economic calendar for Tuesday remains quiet, suggesting that the main market action will focus on Yellen's testimony in Congress. In company news, Barclays (BCS) announced Tuesday that it would be cutting 12,000 jobs, which came as the U.K.'s second-largest bank reported a lower-than-anticipated profit of $315 million. Shares were falling more than 4.5% in premarket trading. Boeing's (BA) embattled 787 Dreamliner received more criticism Tuesday as Air India complained that it is displeased with the airplane's performance. Investors are familiar with the 787 Boeing commercial jet for its three-month grounding last year on battery meltdowns reported in two planes of its fleet, among other issues, since its 2011 introduction. -- Written by Joe Deaux in New York >Contact by Email. Follow @JoeDeaux
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