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U.S. equity futures moved higher in early Monday trading, while the dollar slipped lower against its global peers, as investors braced for a busy week on Wall Street while navigating the unprecedented turmoil in domestic politics triggered by President Joe Biden’s decision to withdraw from the 2024 election.
Biden, who made his decision in a statement released Sunday, has backed Vice President Kamala Harris as the Democrats best hope to take on former President and frontrunner Donald Trump, with betting markets now adjusting their odds for the November result as well as House and Senate races.
“While it has been my intention to seek reelection, I believe it is in the best interest of my party and the country for me to stand down and to focus solely on fulfilling my duties as President for the remainder of my term,” Biden said.
Stocks are likely to face renewed volatility as a result of the entry of Harris, 59, into the presidential race as investors judge whether to unwind last week’s ‘Trump trade’ that saw big declines in megacap tech and a rotation into smaller company and domestic-focused stocks.
Vice President Kamala Harris, 59, has received a flurry of endorsements from senior Democratic officials following President Joe Biden’s decision to exit the 2024 presidential election.
Mason Trinca/Getty
The CBOE Group’s VIX index, the market’s benchmark volatility gauge, was last marked 3.6% higher at $16.50 following news of Biden’s withdraw, near to the highest levels in six months.
At $16.52, the VIX suggests traders expect the S&P 500 to have a daily swing of around 1.03%, or around 57 points, over the next 30 days.
Related: Market risk rises as Biden drops out of presidential race
On Wall Street, stocks are set for a firmer open to offset last week’s pullback, with futures contracts tied to the S&P 500 indicating a 26 point opening bell gain and those linked to the Dow Jones Industrial Average priced for a 52 point advance.
The tech-focused Nasdaq, meanwhile, is called 135 points higher ahead of an active week for corporate earnings that includes updates from heavyweights such as Tesla (TSLA) , and Google parent Alphabet (GOOGL) .
Around 134 S&P 500 companies will report second quarter earnings this week, with analyst looking for collective profits for the benchmark to rise 11.1% from last year to $496.7 billion.
Related: Stock sentiment resets after tech pullback
Two key economic data releases this week include a first look at second quarter GDP growth on Thursday and the Federal Reserve’s preferred inflation gauge for the month of June, the PCE Price Index, slated for Friday.
More Wall Street Analysts:
Analyst revisits Nvidia stock price target after Blackwell checksAnalysts prescribe new Walgreens stock price targets after earningsAnalyst revises Facebook parent stock price target in AI arms race
Overseas markets were mixed following news of Biden’s departure from the presidential race, with stocks in Asia falling broadly across the board, despite an interest rate cut from the People’s Bank of China, and markets in Europe edging modestly higher.
The region-wide Stoxx 600 was marked 0.98% higher in Frankfurt, with Britain’s FTSE 100 up 0.81% higher in London.
Related: Veteran fund manager sees world of pain coming for stocks
