US stock futures ticked on Tuesday, suggesting that major benchmarks could extend their rally the day after closing in the record.
The futures tied the S&P 500 and the Dow Jones Industrial Average by 0.5%. Both indices closed at an all-time high on Monday. Contracts also climbed 0.5% on the Nasdaq-100 index, indicating that technology stocks would also benefit.
Stocks are moving higher in the last days of the year, part of the cheap money received by central banks and governments to shield the global economy from the coronovirus epidemic. The S&P 500 index climbed more than 15% this year, rising 29% in 2019, while the Nasdaq Composite Index rose to over 43% in 2020 alone.
“Some people are getting away from the record race. The momentum of the market is pushing and crossing these record highs, ”said Carson Bruskey, global head of macro research at INGJep..
“They are imaginary thresholds, but the benchmark can live its life and it is happening now.”
Trading volumes are typically thin with many people on vacation in the last days of the year, which can potentially increase market moves.
Investor sentiment was also boosted after the House on Monday approved the proposal to increase the size of incentive check from $ 600 to $ 2,000. The measure now goes to the Senate where its fate is uncertain. Senate Majority Leader Mitch McConnell (R., Ky.) Has not made any comment about whether he will take the bill.
“Markets are not necessarily taking the potential growth given, but there is an excitement about the possibility of pushing it forward. It is being partially priced,” Mr. Brzeski said.
The WSJ Dollar Index, which tracks the US currency against a basket of others, fell 0.3% to its lowest level in a week.
In bond markets, the yield on the benchmark 10-year Treasury ticked from 0.932% to 0.941% on Monday.
Meanwhile, the coronovirus epidemic continues with hospitalization rates in the US, with a new high on Monday. Intensive care units are also coming under pressure.
“It’s a combination of lockdowns, virus spreads and new strains, but investors are still emphasizing positive news flows,” said Zero Blokland, head of multiset at Robeco.
Snap rose more than 3% in premarket trading, after a Goldman Sachs analyst raised the price target on the developer of the Snapchat app.
Foreign, all-continental stocks Europe 600 added 0.9%.
In the UK, where markets reopened on Tuesday, the main FTSE 100 stock benchmark rose by more than 2% as investors struck a deal after Brexit on Christmas Eve. British and European Union officials reached an agreement, including a free trade agreement, ending in four years of uncertainty.
“The Brexit deal will help sense sentiment.” As investors arrive in the office for the first time after Christmas, people are looking at the details of the deal, ”said James Athey, investment manager at Aberdeen Standard Investments.
Between European equations, AstraZeneca has jumped about 4% on reports that the drug company Kovid-19 vaccine may be approved by the UK government in the coming days.
British banks were among the worst performers, with Lloyds Banking Group slipping around 4%, Barclays down around 3% and NatWest Group down 2.7%. It is not entirely clear how the Brexit deal will affect financial services.
In Asia, most of the major benchmarks reached close to trading. Japan’s Nikkei 225 index climbed 2.7% to a 30-year high. Hong Kong’s Hang Seng index gained 1%, while the Shanghai Composite Index declined 0.5%.
“The momentum in Asian stocks suggests that this entire vaccine-induced rally is going global,” Mr. Blokland said. “For 2021, we are strong enough, we think the economic recovery will recommend [the first quarter] And incentives outside the US will get a boost. “
Write Anna Hirtenstein at [email protected]
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