Wall Street Rebounds Amid Early Trading Surge

Wall Street's main indexes were set to open higher after a previous rout, driven by optimistic Federal Reserve comments and bargain-hunting investors. Megacap and growth stocks saw recovery in premarket trading. Despite mixed performances from major companies, the market stayed hopeful with an anticipated interest rate cut by the US central bank.

Wall Street's main indexes looked poised to open higher on Tuesday following a volatile previous session, as investors sought bargains and Federal Reserve officials' dovish rate commentary lifted sentiment. Megacap and growth stocks, which had lost $200 billion in market value on Monday, saw a recovery in premarket trading, with Nvidia bouncing back 2.6%.

Apple slipped 1.3%, extending a nearly 5% drop from Monday after Berkshire Hathaway halved its stake in the company. Both the S&P 500 and the Nasdaq Composite faced over 3% losses in the previous session due to weak economic data and unwinding of high-yielding asset carry trades, raising recession concerns.

Goldman Sachs noted that buying after a 5% S&P 500 selloff often proves profitable. David Waddell of Waddell & Associates highlighted a fleeting relief rally driven by a slight overnight depreciation of the yen, easing selling pressure. The chance of a 50-basis-point September rate cut by the Fed stood at 75%, as top brokerages predict a similar reduction based on weak job reports.

The CBOE Volatility Index reached 32.72 points after peaking at 65.73 on Monday. Dow and S&P 500 E-minis rose modestly in early trading, while strong corporate earnings from Palantir Technologies, Caterpillar, and Uber further buoyed market sentiment. Futures tied to the Russell 2000 index also advanced by 0.5%.