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Pfizer Vaccine Boost Lifts Wall Street Futures, Nasdaq Extends Record High

Re-opening, travel and tech stocks are giving global markets a boost Tuesday as investors hope the FDA's approval of the Pfizer/BioNTech vaccine will tame the Delta-variant spread.

The Tuesday Market Minute

  • Global markets hold gains, with Asia getting a boost from yesterday's FDA move on Pfizer and Europe riding re-opening and travel stocks.
  • Benchmark 10-year Treasury note yields hold at 1.265%, while 2-year notes trade at 0.232%  ahead of an $80 billion auction later today.
  • Oil extends gains from yesterday's 5% surge on re-opening bets, with Brent crude testing $70 a barrel.
  • U.S. equity futures suggest a modestly firmer open on Wall Street ahead of second quarter earnings from Best Buy and Nordstrom as well as Redbook retail sales data at 8:55 am Eastern time.

U.S. equity futures traded higher Tuesday, with the Nasdaq set to extend gains from last night's record close, as investor sentiment gets a boost from the FDA's vaccine approval and a solid economic runway heading into the final months of the year.

Monday's decision by the Food & Drug Administration to fully approve the Pfizer  (PFE) - Get Pfizer Inc. Report/BioNtech  (BNTX) - Get BioNTech SE Report coronavirus vaccine provided markets with a much-needed boost that not only lifted the Nasdaq to a fresh closing high, but also spilled over into the Asia session with gains for tech, travel and mining stocks as well as a second rally for global oil prices. 

Here in the U.S., hopes that full FDA approval will accelerate vaccination rates -- alongside corporate and government mandates -- could spark a near-term rally in re-opening stocks, although investors are likely to remain cautious ahead of Friday's speech from Federal Reserve Chairman Jerome Powell that could set out the central bank's policy ambitions for the final months of the year.

IHS/Markit's composite reading of U.S. economy activity, which slipped to a December low of 55.4 in August, nonetheless continues to provide a solid runway heading into the Autumn and remains well above the 50-point mark that separates growth from contraction.

In the meantime, a largely tame bond market, where 10-year Treasury note yields are trading at 1.265%, and a much-better-than-expected second quarter earnings season are also supporting gains on Wall Street, with futures contracts tied to the Dow Jones Industrial Average indicating a modest opening bell gain of around 45 points.

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Contracts tied to the S&P 500, meanwhile, are priced for an 8.5 point move to the upside while Nasdaq futures are indicating a 65 point opening bell gain, thanks in part to pre-market moves for Apple  (AAPL) - Get Apple Inc. Report, Nvidia  (NVDA) - Get NVIDIA Corporation Report and Tesla  (TSLA) - Get Tesla Inc Report

Oil prices extended yesterday's 5% surge in overnight trading, with WTI crude futures for October delivery marked 60 cents higher at $66.25 per barrel as investors accelerated re-opening bets and boosted energy demand prospects over the final months of the year.

The U.S. dollar index was marked 0.1% higher against a basket of its global peers at 93.03 while benchmark 2-year note yields were last seen at 0.232% ahead of an $80 auction of new notes at 1:00 PM Eastern time.

In overseas markets, European stocks were mixed, with the FTSE 100 slipping 0.11% and the Stoxx 600 rising 0.11% following a stronger-than-expected reading for second quarter GDP in Germany. 

In Asia, Japan's Nikkei 225 closed 0.87% higher at 27,752.10 points while the region-wide MSCI ex-Japan benchmark used a solid rebound in China tech stocks to trade 1.83% higher on the session.