Stock futures opened higher on Tuesday morning after the Biden administration and Republican lawmakers reached a tentative deal on raising the U.S. debt ceiling.
Dow Jones Industrial Average futures were up 72 points, or 0.2%, to 33,182.
S&P 500 futures gained 11.50 points, or 0.27%, to 4,224.75.
Nasdaq 100 futures climbed 71.50 points, or 0.50%, to 14,404.00.
The tentative deal would raise the debt ceiling by $480 billion, enough to cover the government's borrowing needs through December. The agreement is still subject to final approval from Congress, but it is seen as a major step towards avoiding a default on U.S. debt.
A default on U.S. debt would have had a significant impact on the stock market, as investors would have been forced to sell assets in order to raise cash. The tentative deal is seen as a relief to investors, and it is likely to lead to higher stock prices in the near term.
In addition to the debt deal, investors will also be watching for economic data on Tuesday. The Commerce Department is scheduled to release its report on retail sales for April. Economists are expecting retail sales to rise 0.8% in April, following a 0.9% increase in March.
The Federal Reserve is also scheduled to release the minutes from its May meeting. The minutes will provide insight into the Fed's thinking on interest rates and monetary policy.
Overall, stock futures are pointing to a higher open on Tuesday. The tentative debt deal is seen as a relief to investors, and it is likely to lead to higher stock prices in the near term.
Expectations
However, there are some risks that could weigh on the market. The war in Ukraine is still ongoing, and there is always the possibility of a wider conflict. Inflation is also a concern, as it is eating into corporate profits and consumer spending.
Despite these risks, the stock market is still expected to end the year higher. The economy is growing, and corporate earnings are expected to continue to grow. This should support stock prices in the long term.