US equity futures rise on stimulus bets
US equity futures rose on Thursday as investors cheered signs of progress toward a new stimulus package that could support the economy through a possible winter slowdown.
S&P 500 futures rose 0.5%, indicating that the benchmark stock gauge could rise for a third day in a row at the opening bell. The S&P 500 is closed In its second highest ever Wednesday. Futures linked to the technology-focused Nasdaq 100 index rose 0.5%.
On Wednesday, congressional leaders concluded a nearly $ 900 billion coronavirus relief package Another round of direct payments to families. After months of stalemate, the emerging agreement represented a breakthrough at a critical time in the pandemic, with the vaccine being distributed however Hospital admission to record levels.
Investors widely believe that a new dose of stimulus is necessary to support the economy until the end of winter, and that the vaccines circulating have the potential to control the virus in 2021. It appears that the increased cases have affected consumer sentiment, Affect retail salesThere are new trade restrictions in some states.
“Motivation is the key,” said Mary Nicola, portfolio manager at PineBridge Investments.
Nicolas added: “Any catalyst is a good motivator at this stage, especially when you are going through a difficult stage.” “This will provide more support for the recovery.”
The weekly data on initial jobless claims will shed new light on the state of the economy at 8:30 AM ET. Jobless claims rose early this month in a sign of a fresh slump in the job market. It’s possible that they backed off a little Economists expected the week ending December 12th, while it remained at high levels.
Before the bell in New York, share in
It rose nearly 4% after the home builder said first-quarter home deliveries and orders would be stronger than analysts expected.
Global markets also rose on Thursday. The region’s Stoxx Europe 600 rose 0.5%, led by shares of economically sensitive commodity producers and retailers alongside media companies. The China Shanghai Composite ended up 1.1%. Japan’s Nikkei 225 index rose 0.2%.
Among European stocks, shares in
Up nearly 5% after the advertising giant said sales are recovering faster than expected from the coronavirus shock. Rio Tinto shares listed in London rose 1.4% after the mining company named its CFO Jacob Stucholm as its new CEO.
In bonds, the yield on 10-year Treasuries rose to 0.926% from 0.920% Wednesday. The dollar extended its recent decline. The WSJ dollar index fell 0.4%, after falling to its lowest level since April 2018 on Wednesday.
The drop came after the Federal Reserve said it was $ 120 billion per month Asset purchases will continue Until significant progress is made towards employment and inflation targets. The updated guidance confirms that the central bank will remain supportive of financial markets for some time to come, said Ms Nicolas of PineBridge.
Along with direct checks, the stimulus package under discussion in Washington was expected to include $ 300 per week in enhanced unemployment insurance and vaccine distribution financing. Congressional aides indicated that negotiations were continuing and no final agreement had been reached.
Time is tight. Legislators expect the aid bill to be attached to the full-year spending bill needed to keep the government running after its current funding expires at 12:01 am on Saturday.
“Obviously we’re very close to the time period when getting a deal across the line is very difficult,” said Edward Park, chief investment officer at Brooks MacDonald. “Providing some incentives here is definitely a positive, incremental step.”
Indications that The United Kingdom and the European Union can strike a trade deal Before Britain left the bloc at the start of 2021, markets have also strengthened in recent days, Mr. Park said. The last-minute negotiations added to the focus of the Bank of England’s decision on Thursday to keep the benchmark interest rate suspended at 0.1%, maintain its government bond purchases, and extend the financing program for banks.
The central bank said restrictions designed to suppress the coronavirus will affect the UK economy in this quarter and in the first three months of 2021.
The weak dollar gave a boost to commodity markets. Gold futures rose 1.2% to $ 1,881.10 an ounce.
The three-month copper futures contract advanced 1.4% to $ 7,920.50 per metric ton on the London Metal Exchange.
Write to Joe Wallace at [email protected]
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