U.S. stock futures were mixed Tuesday morning, after equity markets logged a three-session winning streak as a rebound in bond yields eased concerns of a possible recession. The Dow Jones Industrial Average added 250 points Monday, erasing most of Wednesday's 800-point plunge. But the Dow was still down 2.6% for August. While rising bond yields in recent days helped boost stocks, Treasury yields Tuesday morning were under some pressure. The spread on the 10-year and 2-year yields, which briefly inverted last week, remained right side up.
The White House is denying a Washington Post report that Trump administration officials floated the idea of a payroll tax cut as a way to stem a potential economic downturn. The report came as President Donald Trump has been lashing out over growing recession fears in the market due to last week's yield curve inversion and the U.S.-China trade war. The president has also continued to bash the Federal Reserve, saying it has been keeping interest rates too high.
China may have a new way of boosting its economy, which has been slowing under pressure from the Trump tariffs on Chinese imports into the U.S. The People's Bank of China is changing the way commercial lenders set interest rates for loans. On the technology side of the U.S.-China dispute, the Trump administration offered another 90-day extension of a special license to allow American companies to sell limited and specific products to Huawei. However, the U.S. added 46 more affiliates of the Chinese telecom giant onto its blacklist. China calls the move "unjust" and "politically motivated."
Shares of Home Depot were higher in premarket trading Tuesday morning, after the home improvement retailer beat estimates with second-quarter earnings of $3.17 per share. However, revenue of $30.8 billion fell short of expectations. Home Depot also lowered its sales outlook for the year on worries that the China trade war will slow consumer spending. The company had previously warned about the toll a slump in lumber prices is taking on its business. Lumber accounts for about 8% of Home Depot's total sales.
Shares of Beyond Meat were getting a 7% pop in the premarket Tuesday to nearly $155 each, after J.P. Morgan upgraded the plant-based meat company from to overweight from neutral and lifted its target price a dollar to $189 per share. J.P. Morgan cited several reasons for its upgrade, including the fact that the stock has dropped 40% since its high on July 26. However, Beyond Meat has still surged 476% as of Monday's close since its May initial public offering price of $25 per share. The stock did sink since late July, after the company issued a surprise secondary stock offering and a bigger than expected second-quarter loss.