U.S. stock index futures changed little during Monday morning trading after Monday’s Dow and S&P closed at record highs amid optimism over the economic reopening.
Dow-linked futures fell 45 points. S&P 500 futures fell 0.1%, while Nasdaq 100 futures advanced 0.03%.
During normal trading hours on Monday, the Dow Jones index jumped 174 points, reaching its 21st intraday record of the year and the 14th record high of closing in 2021. It was also the seventh consecutive positive session of the average of 30 stocks – the longest daily winning streak since August.
The S&P 500, however, gained 0.64% for its fifth consecutive positive session. The benchmark index reached its 16th intraday high of the year and the 13th record closing high.
The Nasdaq Composite performed relatively well on Monday, gaining 1.05% and recovering some of its recent losses.
Shares of Big Tech companies and economic reopening as airlines have driven the main averages to rise, as the launch of the coronavirus vaccine continues.
“The distribution of COVID-19 vaccines is bringing us closer to a fully reopened economy and is probably the most important factor in assessing the prospects for economic growth for 2021,” noted strategists at LPL Financial. “We expect interest rates to decline as a threat to the markets,” added the company.
The 10-year Treasury yield was trading at around 1.6% on Monday, after reaching its highest level in more than a year on Friday. The recent jump in bond yields has generated a rotation of growth names, as companies’ future cash flows begin to look less attractive compared to other assets.
“After a top performance cycle of approximately 14 years, the dominance of growth over value peaked in the fall of 2020,” said Keith Lerner, chief market strategist at Truist. “We still see more value advantages over growth over the next 12 months, given the dramatic long-term underperformance of the value, as well as the US economy being on the verge of the best growth in more than 35 years.”
On Tuesday, Lennar and CrowdStrike are among the companies set to report earnings. February retail sales data is also expected to be released, in addition to data on the sentiment of the builder from the National Association of Home Builders.
Meanwhile, the Federal Reserve will begin its two-day meeting on Tuesday, followed by a statement and briefing by President Jerome Powell on Wednesday.