Nasdaq, S&P 500 Futures Slip Even As Senate Clears Funding Bill, But Strategist Says Negativity Toward Market Getting ‘Harder To Defend’

• The Senate has passed the stopgap funding bill, which now has to be cleared by the House before being signed into law.  
• A strategist sees a nice rebound in fundamentally sound, superior stocks.
• Retail sentiment toward the tech stocks has improved notably on the Stocktwits platform.

U.S. stock futures were mostly lower early Tuesday after the tech-led recovery seen in the previous session. The lackluster sentiment has emerged despite the Senate's passage of the stopgap funding bill, which now has to be cleared by the House before being signed into law.  

The government shutdown has now gone on for a record 41 days. The bill, dubbed “H.R. 5371,” to make continuing appropriations and extensions for fiscal year 2026 and for other purposes, was adopted by a 60:40 margin. Five moderate Democrats switching allegiance helped the bill clear the Upper House.

Sentiment may also have been dented by a Wall Street Journal report, citing sources, that stated that China was mulling excluding companies linked to the U.S. military from accessing rare earths from the country.

That said, a strategist is optimistic about the near-term trajectory. Fund manager Louis Navellier said he expects a “nice rebound in fundamentally superior stocks.” “As we get closer to Thanksgiving, the stock market should naturally cheer up, since the holidays are a happy time of year,” the strategist said.

“Furthermore, the negativity about the stock market is getting harder to defend in the wake of the strongest earnings in four years, plus 4% GDP growth.”

Trading activity could be light due to the Veteran's Day holiday on Tuesday.

How Futures Are Trading

As of 2:45 a.m. ET on Tuesday, the Nasdaq 100,  S&P 500 and Russell 2000 futures were modestly lower, while the Dow futures rose 0.03%.

On Stocktwits, retail sentiment toward the SPDR S&P 500 ETF (SPY), an exchange-traded fund that tracks the S&P 500 Index, improved to ‘bullish’ as of early Tuesday from ‘neutral’ a day ago. The Invesco QQQ Trust (QQQ) ETF, which tracks the Nasdaq 100 Index, attracted ‘extremely bullish’ sentiment, up from the ‘bullish’ mood that was seen for much of the past week. The message volume on the SPY and QQQ streams remained ‘high.’

Commenting on the QQQ stream, a bullish watcher said the major index ETFs, along with Bitcoin, will continue to grind higher.

Another user predicted that the QQQ ETF will add another 10% by year-end and an additional 20% by March.

How Markets Fared Monday

Stocks came back up with a vengeance on Monday, with the techs that have spearheaded the rally in the current bull market once again coming to the rescue. Bargain hunting led to substantial gains in some prominent tech names, including Nvidia (NVDA). The stock received a shot in the arm from Jensen Huang’s comments about placing additional wafer orders with supplier TSMC (TSM).

The Dow Jones Industrial Average jumped nearly 400 points, and the Nasdaq Composite and the S&P 500 indices recorded their best single-day gains since May, according to MarketWatch.

Among S&P sectors, all but defensive real estate, utility and consumer staple stocks, ended higher for the day.

Key Catalysts To Watch Out For

The National Federation of Independent Business (NFIB) is scheduled to release its optimism index at 6 a.m. ET.  The index is expected to slip to 98 in October from 98.8 in the previous month.

The most noteworthy earnings scheduled for the day are Sea Limited (SE), NANO Nuclear Energy (NNE) and Oklo, Inc. (OKLO).

How Other Markets Fared

Crude oil futures fell moderately early Tuesday, while gold futures continued to extend their gains amid the lingering uncertainty. The 10-year U.S. Treasury note yield moved further above the 4.1% mark, and the U.S. dollar was slightly firmer against its counterparts. Most major Asian markets retreated after the previous session’s substantial gains.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

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