Stocks finished higher on Friday, with the S&P 500 and Nasdaq closing out the session at record levels.
The S&P 500 and Nasdaq each rose about 0.5 %, while the Dow ended only a tick above the flatline. U.S. stocks shook off earlier declines after monitoring a drop in overseas equities, after new data showed that UK gross domestic product (GDP) slumped by a record 9.9 % in 2020 as a virus-induced recession swept the nation.
Shares of Dow component Disney (DIS) reversed earlier benefits to fall more than 1 % and pull back from a record extremely high, after the company posted a surprise quarterly profit and produced Disney+ streaming prospects much more than expected. Newly public company Bumble (BMBL), which started trading on the Nasdaq on Thursday, rose another seven % after jumping sixty three % in its public debut.
Over the past couple weeks, investors have absorbed a bevy of stronger than expected earnings results, with corporate profits rebounding way quicker than expected despite the continuous pandemic. With at least eighty % of businesses these days having claimed fourth-quarter results, S&P 500 earnings per share (EPS) have topped estimates by seventeen % for aggregate, and bounced back above pre COVID levels, according to an analysis by Credit Suisse analyst Jonathan Golub.
“Prompt and generous government behavior mitigated the [virus-related] damage, leading to outsized economic and earnings surprises,” Golub said. “The earnings recovery has been substantially more robust than we may have thought possible when the pandemic for starters took hold.”
Stocks have continued to set up fresh record highs against this backdrop, and as monetary and fiscal policy support remain strong. But as investors come to be used to firming business functionality, businesses could possibly need to top greater expectations to be rewarded. This may in turn put some pressure on the broader market in the near term, as well as warrant more astute assessments of specific stocks, in accordance with some strategists.
“It is actually no secret that S&P 500 performance has been very formidable over the past few calendar years, driven largely through valuation expansion. But, with the index P/E [price-to-earnings ratio] recently eclipsing its prior dot-com extremely high, we believe that valuation multiples will start to compress in the coming months,” BMO Capital Markets strategist Brian Belski wrote in a note Thursday. “According to our job, strong EPS growth is going to be required for the next leg higher. Thankfully, that is exactly what current expectations are forecasting. But, we also discovered that these types of’ EPS-driven’ periods tend to be challenging from an investment strategy standpoint.”
“We believe that the’ easy cash days’ are over for the time being and investors will have to tighten up their focus by evaluating the merits of individual stocks, as opposed to chasing the momentum laden practices which have just recently dominated the investment landscape,” he added.
4:00 p.m. ET: Stocks end higher, S&P 500 and Nasdaq reach report closing highs
Here’s where the major stock indexes finished the session:
S&P 500 (GSPC): +18.55 points (+0.47 %) to 3,934.93
Dow (DJI): +27.44 points (+0.09 %) to 31,458.14
Nasdaq (IXIC): +69.70 points (+0.5 %) to 14,095.47
2:58 p.m. ET:’ Climate change’ is the most-cited Biden policy on company earnings calls: FactSet
Fourth-quarter earnings season signifies the first with President Joe Biden in the White House, bringing a new political backdrop for corporations to contemplate.
Biden’s policies around climate change and environmental protections have been the most cited political issues brought up on corporate earnings calls thus far, based on an analysis from FactSet’s John Butters.
“In terms of government policies talked about in conjunction with the Biden administration, climate change as well as energy policy (28), tax policy (20 COVID-19 and) policy (nineteen) have been cited or maybe discussed by probably the highest number of companies through this point on time in 2021,” Butters wrote. “Of these 28 firms, 17 expressed support (or a willingness to work with) the Biden administration on policies to greatly reduce carbon as well as greenhouse gas emissions. These 17 companies possibly discussed initiatives to minimize the own carbon of theirs as well as greenhouse gas emissions or maybe goods or services they give to assist clients & customers reduce the carbon of theirs and greenhouse gas emissions.”
“However, four businesses also expressed a number of concerns about the executive order setting up a moratorium on new engine oil as well as gas leases on federal lands (plus offshore),” he added.
The list of 28 companies discussing climate change as well as energy policy encompassed businesses from a broad array of industries, including JPMorgan Chase, United Airlines Holdings and 3M, alongside conventional oil majors as Chevron.
11:36 a.m. ET: Stocks mixed, S&P 500 and Nasdaq turn positive
Here is in which marketplaces had been trading Friday intraday:
S&P 500 (GSPC): +7.87 points (+0.2 %) to 3,924.25
Dow (DJI): 8.77 points (-0.03 %) to 31,421.93
Nasdaq (IXIC): +28.15 points (+0.21 %) to 14,053.77
Crude (CL=F): +$0.65 (+1.12 %) to $58.89 a barrel
Gold (GC=F): +$0.20 (+0.01 %) to $1,827.00 per ounce
10-year Treasury (TNX): +2.7 bps to deliver 1.185%
10:15 a.m. ET: Consumer sentiment unexpectedly plunges to a six-month low in February: U. Michigan
U.S. consumer sentiment slid to the lowest level since August in February, in accordance with the University of Michigan’s preliminary month to month survey, as Americans’ assessments of the path forward for the virus-stricken economy suddenly grew much more grim.
The headline consumer sentiment index dipped to 76.2 from 79.0 in January, sharply missing expectations for an increase to 80.9, based on Bloomberg consensus data.
The complete loss in February was “concentrated in the Expectation Index and among households with incomes under $75,000. Households with incomes in the bottom third reported significant setbacks in their present finances, with fewer of the households mentioning recent income gains than anytime after 2014,” Richard Curtin chief economist for the university’s Surveys of Consumers, said in a statement.
“Presumably a brand new round of stimulus payments will reduce financial hardships among those with probably the lowest incomes. Much more surprising was the finding that customers, despite the likely passage of a grand stimulus bill, viewed prospects for the national economy less favorably in early February than more month,” he added.
9:30 a.m. ET: Stocks open lower, but pace toward posting weekly gains
Here is in which marketplaces were trading just after the opening bell:
S&P 500 (GSPC): -8.31 points (0.21 %) to 3,908.07
Dow (DJI): -19.64 (-0.06 %) to 31,411.06
Nasdaq (IXIC): 53.51 (+0.41 %) to 13,970.45
Crude (CL=F): 1dolar1 0.23 (0.39 %) to $58.01 a barrel
Gold (GC=F): -1dolar1 10.70 (0.59 %) to $1,816.10 per ounce
10-year Treasury (TNX): +3.2 bps to deliver 1.19%
9:05 a.m. ET: Equity funds see highest weekly inflows actually as investors pile into tech stocks: Bank of America
Stock funds just discovered the largest-ever week of theirs of inflows for the period ended February 10, with inflows totaling a record $58.1 billion, according to Bank of America. Investors pulled a total of $800 million out of gold and $10.6 billion out of money during the week, the firm added.
Tech stocks in turn saw the own record week of theirs of inflows at $5.4 billion. U.S. large cap stocks saw their second-largest week of inflows ever at $25.1 billion, and U.S. small cap inflows saw the third-largest week of theirs at $5.6 billion.
Bank of America warned that frothiness is actually rising in markets, however, as investors continue piling into stocks amid low interest rates, as well as hopes of a good recovery for the economy and corporate earnings. The firm’s proprietary “Bull as well as Bear Indicator” tracking market sentiment rose to 7.7 from 7.5, nearing an 8.0 “sell” signal.
7:14 a.m. ET Friday: Stock futures point to a lower open
Below were the principle movements in markets, as of 7:16 a.m. ET Friday:
S&P 500 futures (ES=F): 3,904.00, down 8.00 points or even 0.2%
Dow futures (YM=F): 31,305.00, down 54 points or perhaps 0.17%
Nasdaq futures (NQ=F): 13,711.25, printed 17.75 points or perhaps 0.13%
Crude (CL=F): 1dolar1 0.43 (0.74 %) to $57.81 a barrel
Gold (GC=F): -1dolar1 9.50 (-0.52 %) to $1,817.30 per ounce
10-year Treasury (TNX): +0.5 bps to deliver 1.163%
6:03 p.m. ET Thursday: Stock futures tick higher
Here is in which marketplaces were trading Thursday as overnight trading kicked off:
S&P 500 futures (ES=F): 3,904.50, printed 7.5 points or 0.19%
Dow futures (YM=F): 31,327.00, down thirty two points or perhaps 0.1%
Nasdaq futures (NQ=F): 13,703.5, down 25.5 points or even 0.19%