Stock futures mixed after hitting record highs

Published On: January 22, 2021Categories: Stocks & Shares1.9 min read

Both the S&P 500 and Nasdaq finished at record levels, and the Dow ended just short of its own record high

Stock futures traded mixed Thursday evening after touching record highs yet again. Both the S&P 500 and Nasdaq ended the regular trading day at record closing levels, and the Dow ended just short of its own record high. Tech stocks led the advances, as the information technology, consumer discretionary and communication services sectors each outperformed.

Investors have been closely monitoring the first moves of the Biden administration. In his first days in office, President Joe Biden already signed a number of executive orders addressing key issues including the coronavirus pandemic, and unveiled a national virus containment strategy that included ramping up vaccine supplies to be able to administer 100 million vaccines in his first 100 days in office.

One of his main upcoming challenges, however, will be advancing his $1.9 trillion coronavirus proposal through Congress, with some lawmakers already balking at the size and contents of the hefty bill.

New economic data on Thursday, which showed that new weekly jobless claims came in at historically elevated 900,000 last week, underscored the economic toll of the pandemic even following the last $900 billion stimulus package.

A Moody’s Analytics report found that the Biden administration stimulus plan would enable the U.S. labour market to recover its pandemic-era losses by the fall of 2022, or a year earlier than if no further stimulus were enacted.

This is [going to be a] difficult process. We’re talking about $2 trillion or something around that after we’ve already spent $4 trillion. You have now a Republican minority, but very thin minority, Joshua Lipsky, Atlantic Council GeoEconomics Center director, told Yahoo Finance on Thursday. So what the Biden administration offered, as the press secretary said [Wednesday], was their offer. It’s a package. They’re open to negotiation.

I think the big pressure point here is going to be on state and local funding, he added. That’s where Republicans will want to see cuts, and that’s where Democrats see a real priority that’s actually been underfunded over the last year.

Still, hopes for more stimulus as well as speculation over other policy changes under the Biden administration have been a key driver of equities over the past month, and have accelerated a rotation into some of the names most beaten-down earlier on during the pandemic. Though tech stocks again led the way higher during Thursday’s session, cyclicals including industrials, travel stocks and small caps had been performing strongly over the past couple of weeks.

About the Author: Jonathan Adams

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