Shares falling after announcement of Biden’s proposed recovery package

U.S. stock futures are tending to drop hours before the opening bell on Friday after President-elect Joe Biden announced his plans to propose a $ 1.9 trillion package to help recover from the coronavirus pandemic. . Biden talked about the plan after the market closed on Thursday.

Biden’s coronavirus plan would include $ 1,400 checks for individuals, in addition to the $ 600 provided on the last COVID-19 bill. The plan would also extend a temporary increase in unemployment benefits and a moratorium on evictions and foreclosures until September. It also provides funds for a mass vaccination campaign and a major expansion of local public health efforts.

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Markets have been charging more recently recently amid growing optimism that the launch of coronavirus vaccines will set the stage for a major recovery in the economy and corporate profits later this year. Expectations are also rising for a new round of economic stimulus, because Democrats are soon to take control of Congress and the White House.

Investors expect more government stimuli to balance the economy until the COVID-19 vaccines return to normal and trigger a powerful recovery later this year.

U.S. stock futures are tending to drop hours before the opening bell, Friday, after President-elect Joe Biden announced his plans to propose a $ 1.9 billion package to help recover from the coronavirus pandemic. . Biden talked about the plan after

But hopes are dampened by the reality that Biden may struggle to get support for massive spending, even from some Democrats, analysts say.

“To some extent, most of that optimism has been assessed, but the huge numbers have also invited some contemplation on whether the necessary bipartisan support will materialize for this huge amount,” said IG’s Jingyi Pan in a comment. “The market appears to be playing for insurance, “she said.

The sentiment was also dampened by US decisions to blacklist several Chinese companies. Chinese smartphone maker Xiaomi Corp., CNOOC, the third largest national oil and aerospace company Skyrizon, are the last to be blacklisted or withdrawn from US stock exchanges for alleged military connections. President Donald Trump’s government has acted to increase pressure on Beijing during his last week in office.

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Meanwhile, Asian stocks fell on Friday after a worse-than-expected US job report and a late fall in several Big Tech stocks, leaving major indexes down on Wall Street.

Japan’s Nikkei 225 fell 0.6% to 28,518.65 and Hang Seng in Hong Kong fell 0.3% to 28,405.72. In Australia, the S & P / ASX 200 was stable at 6,715.40. South Korea’s Kospi fell 1.8% to 3,093.29, while the Shanghai Composite fell 0.6% to 3,543.64.

Thursday on Wall Street, the S&P 500 fell 0.4% to 3,795.54. The benchmark was hurt by losses at Apple, Microsoft and other major technology companies.

The Dow Jones Industrial Average fell 0.2% to 30,991.52. The Nasdaq compound fell 0.1% lower to 13,112.64. The indices are still close to their records recorded last week.

The withdrawal followed another disappointing report, showing the damage the economy is suffering from the worsening pandemic. Last week, an additional 965,000 American workers filed for unemployment insurance as companies close and fire employees. This represents a sharp increase from the previous week’s record of 784,000, and much worse than economists had expected.

Smaller companies have jumped more than the rest of the market, as they usually do when investors are raising their expectations for the economy. The Russell 2000 index for low-capitalization stocks rose 2.1% to 2,155.35.

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The 10-year Treasury yield was 1.11% on Friday, up from 1.13% on Thursday, but above the 1.07% level the previous day. The 10-year yield was 0.90% less two weeks ago, before two run-off elections in Georgia gave Democrats control of the Senate.

In other negotiations, US reference oil dropped 29 cents to $ 53.28 a barrel in e-commerce on the New York Mercantile Exchange. It rose 66 cents to $ 53.57 on Thursday. Brent crude, the international standard, lost 46 cents to $ 55.96 a barrel.

The dollar fell to 103.81 Japanese yen from 103.82 yen on Thursday. The euro weakened to $ 1.2139 from $ 1.2155.