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Stock futures rise after major averages slide on Covid unrest in China

Traders work on the floor of the New York Stock Exchange (NYSE), September 6, 2022.

Brendan McDermid | Reuters

U.S. stock futures were higher on Tuesday morning after the major averages came under pressure from Covid protests in China, and as investors anticipated more economic data and commentary from Federal Reserve leaders this week.

Dow Jones Industrial Average futures added 72 points, or 0.21%. S&P 500 and Nasdaq 100 futures climbed 0.35% and 0.51%, respectively.

The Dow Jones Industrial Average lost 497.57 points, or 1.45%, during the regular session Monday. The S&P 500 slid 1.54%, while the Nasdaq Composite closed down 1.58%.

Growing frustration in mainland China over the country’s zero-Covid policy weighed on markets around the world. On Monday, West Texas Intermediate crude futures briefly fell to their lowest point since last December.

“There’s some real reasons to be cautious. The market’s rallied a lot this quarter, and there’s some concerns that things are going to slow, so I think it’s a kind of balanced risk reward,” Trivariate Research’s Adam Parker said Monday on CNBC’s “Closing Bell: Overtime.”

“I think there was an excuse with maybe some China slowdown fears for people to collect a little profit that they made in the quarter,” he added.

On the economic front, traders will watch for the September reading of the S&P CoreLogic Case-Shiller Home Price Index that is due Tuesday before the bell. The report will give investors insight into how higher interest rates are affecting the housing market. Home prices in the prior month jumped about 13% year over year.

Meanwhile, the latest reading on consumer confidence is set to release at 10 a.m. ET. Wall Street is also expecting the latest corporate earnings results from Hewlett Packard Enterprise Tuesday after the bell.

Fed Chair Jerome Powell is scheduled to speak at the Hutchins Center on Fiscal and Monetary Policy at Brookings on Wednesday. Investors will be listening for insight into the central bank’s fight against inflation.

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