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U.S. stock futures are trading higher ahead of Tuesday’s session on Wall Street, as optimism about President Biden’s $ 1.9 trillion coronavirus aid package approved in controlled Congress increases. by the Democrats.
| Ticker | Safety | Last | Change | Change % |
|---|---|---|---|---|
| I: DJI | DOW JONES AVERAGE | 31802.44 | +306.14 | + 0.97% |
| SP500 | S&P 500 | 3821.35 | -20.59 | -0.54% |
| I: COMP | NASDAQ COMPOSITION INDEX | 12609.161019 | -310.99 | -2.41% |
US stock indexes closed lower, as higher bond yields helped trigger heavier stock sales by tech companies.
The S&P 500 fell 0.5% to 3,821.35 after gaining 1% earlier. Because of its enormous size, the declines of Apple, Google’s parent company and other major technology stocks helped to drag the S&P 500 into the red, although more stocks rose than fell on the benchmark.
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The sale, which accelerated at the end of the day, left the heavy Nasdaq technology compound down 10.5% from the all-time high reached on February 12. A drop of 10% or more from a recent peak is known on Wall Rua as a “correction”.
Bond yields have increased dramatically. The yield on the 10-year Treasury bill rose to 1.60%, compared to 1.55% on Friday. But it dropped to 1.57% after hours.
U.S. stock futures are trading higher ahead of Tuesday’s session on Wall Street, as optimism about President Biden’s $ 1.9 trillion coronavirus aid package, approved in controlled Congress, increases. by the Democrats. (Colin Ziemer / New York Stock Exchange
Yields have soared with rising growth and inflation expectations that will follow. Higher yields put downward pressure on equities in general, in part because they can divert dollars that could have gone into the bond market. This makes investors less willing to pay such high prices for stocks, especially those that look more expensive, like tech stocks.
The Dow Jones Industrial Average rose 1% to 31,802.44. The Nasdaq lost 2.4% to 12,609.16.
Shares in smaller companies, which drove the market up this year, posted further gains. The Russell 2000 index added 0.5% to 2,202.98.
Financial stocks have had some of the best gains. Wells Fargo rose 3.3% and Citigroup gained 2.8%.
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Business has been turbulent in recent weeks, as investors worry about rising long-term interest rates in the bond market. The S&P 500 is coming out of its first weekly earnings in three weeks.
Technology companies have fallen as investors begin to doubt whether the huge gains made during the pandemic months can continue if inflation rises.
Investors have been betting that $ 1.9 trillion in future government stimuli will help lift the economy out of its coronavirus-induced malaise. There are also investors who are betting that stimulating and improving the economy will result in some inflation in the future.
The US economic aid package, narrowly approved by the Senate on Saturday, provides direct payments of up to $ 1,400 for most Americans and extends emergency unemployment benefits. It is a victory for President Joe Biden and his Democratic allies, and final Congressional approval is expected this week.
Oil prices are also rising. After plummeting with the start of the pandemic, as demand plummeted, prices were recovering. Last week, some observers expected the OPEC cartel and its allies to lift more restrictions and let oil flow more freely. But OPEC agreed to leave most of the restrictions in place.
Meanwhile, Asian stocks were mixed on Tuesday, buoyed by the approval of the US stimulus package, although that optimism was tempered by concerns about inflation and the coronavirus pandemic.
Japan’s Nikkei 225 benchmark added almost 1.0% to finish at 29,027.94. South Korea’s Kospi fell 0.7% to 2,976.12. Australia’s S & P / ASX 200 added 0.5% to 6,771.20. Hong Kong’s Hang Seng rose 0.2% to 28,584.96, while Shanghai Composite fell 1.8% to 3,359.26.
Jingyi Pan, senior market strategist at IG in Singapore, said Asian markets are weighing “the impact of a global recovery along with the prospect of an accelerated rise in US bond yields”.
Yoshimasa Maruyama, chief market economist at SMBC Nikko Securities, said that the global economic recovery is stronger than some previously expected, and that recognition is becoming more widespread in March than in February.
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“And the very recognition of the recovery in March will act as a source of more confidence,” he said.
The launch of the vaccine in the United States and Europe will also help inspire confidence in future growth, he added.
The revised economic data for October-December, released on Tuesday, showed that the Japanese economy grew at an annual rate of 11.7%. This was weaker than the 12.7% growth recorded last month in the preliminary estimate.
In quarter-on-quarter terms, growth was 2.8%, compared to the revised 3%, since public and private investment was not as positive as initially thought. Japan’s economy grew at a rate of 22.8% in the period from July to September. This followed a sharp contraction when the pandemic hit tourism, trade, consumption and production.
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In the energy trade, the US benchmark oil for April delivery totaled 2 cents, to $ 65.07 a barrel. It fell $ 1.04, or 1.6%, to $ 65.05 a barrel on Monday. It is still up 32.8% this year. Brent crude, the international standard, rose 16 cents to $ 68.40 a barrel.
In currency trading, the US dollar rose to 109.15 Japanese yen from 108.87 yen on Monday night. The euro strengthened from $ 1.1846 to $ 1.1855.
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AP Business writers Damian J. Troise and Alex Veiga contributed.