U.S. stock index futures remained little changed in overnight trading on Tuesday, after a session that saw stocks between profit and loss.
Futures contracts linked to the Dow Jones business average slipped 20 points. S&P 500 futures and Nasdaq 100 futures both fell 0.09%.
Stocks did not stop changing significantly Tuesday as traders rallied higher rates, added stimulus measures and political turmoil.
The Dow Jones industrial average rose 60 points, or 0.2%, to 31,068.69. The Nasdaq Composite finished the day up 0.3% and the S&P 500 rose slightly to 3,801.19. Meanwhile, yield on the short-term 10-year Treasury benchmark traded at 1.18%, the highest level since March.
With the rise, Credit Suisse suggested that investors prefer pro-cyclical sectors, including finance and energy. Rising rates could hurt growth stock, however, and a number of heavy technologies including Facebook and Apple declined during Tuesday’s session.
Expectations for additional fiscal stimulus is one of the reasons behind a higher sustained trend in output. President Joe Biden is expected to release details of his economic plan on Thursday.
“At a minimum, even a USD 500bn fiscal package that includes additional stimulus studies, expanded unemployment benefits, and funding for health care and vaccine distribution will be another stimulus for economic growth in 2021,” said Jason Draho , head of UBS Global Wealth Management in America asset allocation.
After Tuesday’s silent session, the major averages will be lower for the week following Monday’s slide. The Nasdaq Composite is the comparator, down about 1% over the last two sessions. Small caps, however, are a bright spot, and the Russell 2000 is up 1.7% so far this week.
The trends come as tensions in Washington continue. The Democratic House will vote Tuesday night on a resolution calling on Vice President Mike Pence and the Cabinet to attack the 25th Amendment to push Trump out of the White House.
Covid cases are also on the rise in the US and abroad. The U.S. records at least 248,650 new Covid-19 cases and at least 3,223 virus-related deaths per day, based on a seven-day average measured by CNBC using Johns Hopkins University data.
However, many say the U.S. is ready to return to growth later this year.
“By 2021, the U.S. economy should experience strong tailoring from additional fiscal and monetary stimuli along with ending the impact of the disease on the economy,” said Brent Schutte, chief investment strategy for Wealth Management Mutual Northwestern. “Attractive demand in COVID-19-affected industries … and much-needed inventory rebuilding should boost job growth,” he said.
Taken together, Schutte said this sets the platform for above-average economic growth, and sees stocks climb to new highs.
– Jacob Pramuk from CNBC reported.
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