Tuesday's Market Minute: Bracing For A Rebound

Before yesterday, stocks had been sitting at record highs in 2020 while headline after headline reflected the worsening severity of the Coronavirus outbreak that has begun to expand outside of mainland China where it started. Whether or not yesterday’s losses can be directly tied to COVID-19, especially since markets seemingly shrugged it off until then, it’s looking like there may be a bounce back today.

After the Dow Jones Industrial Average lost 1,000 points yesterday amid a broader market sell-off, the U.S. equity futures are positive in premarket trading this morning, and indicating a higher open for the major averages.

Both the 10-year (/ZN) and 30-year U.S. Treasury Futures (/ZB) are off their highs when traders flooded into the safe-haven assets, including gold futures (/GC). And, the 30-year (TYX) treasury yield is up from all-time lows reached yesterday. In addition, we’re seeing strength out of Home Depot Inc HD premarket after the company posted EPS and sales higher than Wall Street estimates and raised its dividend by 10 percent. Yesterday’s losses happened quickly, however, and despite today’s bullish sentiment, until more is known about COVID-19, traders should exercise caution.