S&P 500 Index Outperforming NASDAQ Composite on Back of Strong Energy Sector

The major U.S. stock indexes are called higher on Wednesday, based on the pre-market trade. The markets are being underpinned by a strong performance by Nike, but lower Treasury yields are also helping to fuel a little of the upside momentum.

At 14:21 GMT, blue chip Dow Jones Industrial Average futures are trading 33367.00, up 314.00 or +0.95%. The benchmark S&P 500 Index is at 3877.25, up 28.00 or +0.73% and the tech-weighted NASDAQ Composite Index is trading 11223.75, up 48.00 or +0.43%.

The Dow is posting the biggest gain in the pre-market session because component Nike is its best performer, putting up an 11% gain.

Nike Surge, Lifts Dow, S&P 500

The Dow and S&P 500 are being underpinned by an impressive performance by shares of Nike. The athletic shoe giant late Tuesday reported quarterly results that easily topped Wall Street’s expectations while raising its outlook, as the company touted its success in clearing through its hefty inventory pile.

S&P 500 Component FedEx Surprisingly Strong

FedEx jumped after the close on Tuesday and was able to hold onto its gains into Wednesday’s opening. Buyers are fueling its nearly 6% gain even after its revenue fell short of Wall Street’s expectations as demand weakened. Additionally, the package delivery giant beat consensus earnings per share estimates and shared a slew of cost-cutting plans.

Retail Sector Rises on the Back of Nike Gains

The retail sector is reaping the benefits of Nike’s strong gains. On the opening, Luluemon is up 3%, Under Armour jumped 4.6% and VF Corp added 2.4%.

Six Flags, Rite Aid Active on the Opening

CNBC is reporting strong upside movement in shares of Rite Aid and Six Flags on the opening.

Rite Aid jumped 4% after reporting a smaller-than-expected loss and revenue that beat Wall Street forecasts, helped by accelerated sales growth at its retail operations. However, the drugstore operator lowered its full-year guidance due to various issues, including seasonal markdowns.

Six Flags gained 7% in premarket action on news that activist shareholder Land & Buildings Investment Management has accumulated a 3% stake in the theme park operator. Land & Buildings has suggested changes to management, including or spinning off the company’s real estate holdings.

Short-Term Outlook

There are no major economic reports on Wednesday and investors may have already priced in the Fed’s aggressive interest rate path so we could see another rally. Additionally, the volume is down so even small buy orders can move the markets higher.

Traders should also keep an eye on Treasury yields. Lower rates are providing support early, but conditions could change at any time.

Energy stocks could give the S&P a big boost if oil prices continue to climb. A bullish government inventories report at 15:30 GMT could trigger a spike higher in crude prices, which could help lift the energy sector.