Upbeat earnings, recovery optimism lift Wall St futures

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(Reuters) -The S&P 500 and Dow indexes were set to rise on Wednesday as upbeat quarterly results from companies including Johnson & Johnson (NYSE:JNJ) and Coca-Cola (NYSE:KO) reignited optimism about the health of corporate America.

Johnson & Johnson gained 1.2% in premarket trading after the drugmaker forecast upbeat 2021 earnings, while Harley-Davidson Inc (NYSE:HOG) added 1.8% as it reported a better-than-expected quarterly profit.

Coca-Cola Co rose 2.6% after boosting its full-year sales forecast, while health insurer Anthem Inc added 1.3% on raising its 2021 earnings target.

“Everybody knows this is going to be the biggest year-over-year growth rate for earnings in the second quarter,” said Tom Martin, senior portfolio manager at GLOBALT Investments.

Wall Street ended sharply higher on Tuesday, rebounding from a multi-day losing streak, as a string of upbeat earnings reports and revived economic optimism fueled a risk-on rally.

“There-is-no-alternative (TINA) and fear-of-missing-out (FOMO) are driving the market higher. Every time there’s a dip in the market, people think that’s the opportunity to put more money to work,” Martin said.

Still, a weak subscriber growth projection by Netflix Inc (NASDAQ:NFLX), the first to report earnings from the FAANG group, pushed its shares down 0.7% and set the teach-heavy Nasdaq for a lower open.

Analysts expect annual S&P earnings growth of 72.9% for the April-June period, a significant improvement over the 54% growth seen at the beginning of the quarter, according to Refinitiv data.

Market participants are also closely watching the second-quarter earnings season to justify sky-high valuations at which the market trades right now.

For the year so far, the benchmark S&P 500 index has gained 15.1% on optimism about a stronger recovery due to vaccinations and favorable monetary policy.

Energy stocks Chevron Corp (NYSE:CVX), Exxon Mobil (NYSE:XOM), Schlumberger NV (NYSE:SLB), Occidental Petroleum (NYSE:OXY), Marathon Oil (NYSE:MRO), and Halliburton (NYSE:HAL) climbed between 1.2% and 3.2%, tracking higher oil prices. [O/R]

United Airlines rose 1.6% after its revenue quadrupled from a year ago and topped estimates with a strong domestic travel rebound.

Rivals American Airlines (NASDAQ:AAL) and Southwest Airlines (NYSE:LUV) added 1.2% and 1.4%, respectively, ahead of their results on Thursday.

Rate-sensitive lenders Morgan Stanley (NYSE:MS), Wells Fargo (NYSE:WFC) & Co, Citigroup (NYSE:C), Goldman Sachs (NYSE:GS), Bank of America Corp (NYSE:BAC) and JPMorgan (NYSE:JPM) & Chase were up over 1% each. [US/]

At 8:38 a.m. ET, Dow e-minis were up 142 points, or 0.41%, S&P 500 e-minis were up 9.25 points, or 0.21%, and Nasdaq 100 e-minis were down 19.75 points, or 0.13%.

Chipotle Mexican Grill Inc (NYSE:CMG) jumped 4.6% as brokerages raised their price targets on the burrito chain’s stock after it beat estimates for earnings and comparable quarterly sales.

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