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Futures point to a flat start for U.S. stocks on Thursday, with major indexes set to trade near records as investors ring out a tumultuous year that saw equities collapse into a bear market before rebounding to all-time highs.
What are major indexes doing?
- Futures on the Dow Jones Industrial Average YM00, -0.06% was up 13 points, or less than 0.1%, at 30,315.
- S&P 500 futures ES00, -0.02% rose 2.55 points to 3,726.75.
- Nasdaq-100 futures NQ00, +0.09% were up 19.25 points, or 0.2%, at 12,860.75.
Stocks logged modest gains Wednesday, nudging the Dow DJIA, +0.24% to a record finish. The S&P 500 SPX, +0.13% closed within 0.1% of its record close of 3,735.36 and the Nasdaq Composite COMP, +0.15% ended just 0.2% below its all-time high finish of 12,889.42 — both set on Tuesday.
Through Thurday’s close, the Nasdaq was on track for an annual gain of more than 43%, its largest since 2009, reflecting huge gains for tech- and internet-related stocks that benefited from the stay-at-home phenomenon created by the pandemic. The S&P 500 was on track for a 15.5% rise, while the Dow was headed for a yearly gain of 6.6%.
What’s driving the market?
Equities are on track to end 2020 on a strong note after plunging into a bear market in February and March as the COVID-19 pandemic threw the global economy into a deep recession. The bear market was one of the shortest in history though, with equities subsequently rebounding as governments and central banks moved to aggressively provide fiscal and monetary stimulus.
Gains were accelerated over the last two months as vaccines were approved and began to be rolled out, even as a resurgence of the virus sends the number of cases and fatalities to new highs.
“Looking into 2021, the burning question is whether this cheerfulness will continue to dominate as vaccines are fully deployed and the global economy heals its wounds. The vast consensus within the financial community is that it will,” said Marios Hadjikyriacos, investment analyst at XM, in a note.
Trading activity was expected to be thin amid holiday-type conditions. Markets will be closed Friday for the New Year’s Day holiday.
Investors appeared to take fading prospects for larger direct payments to U.S. households from the federal government in stride. Senate Majority Leader Mitch McConnell, R-Ky., late Wednesday afternoon said he wouldn’t allow a stand-alone vote on the proposal passed by the Democratic controlled House on Monday that would boost the payouts from $600 to 2,000 under the latest financial aid package signed into law by President Trump last Sunday.
The U.S. counted at least 229,235 new cases on Wednesday, and at least 3,808 people died, according to a New York Times tracker. In the past week, the U.S. has averaged 183,271 cases a day, down 13% from the average two weeks ago, but health experts have warned that cases are likely to rise following travel around Christmas.
There are currently a record 125,220 COVID-19 patients in U.S. hospitals, according to the COVID Tracking Project, breaking the record set a day ago.
The U.S. economic calendar on Friday features weekly data on jobless benefit claims at 8:30 a.m. Eastern. Economists polled by MarketWatch predict first-time jobless claims — a rough measure of layoffs — will climb to 835,000 in the seven days ended Dec. 26 from 803,000 in the prior week, reflecting a pandemic-inspired hit to the labor market.
Which companies are in focus?
- Hedge fund Alden Global said it’s made a $14.25-per-share nonbinding proposal for the shares it doesn’t already own in Tribune Publishing Co. TPCO, +0.31%, the publisher of the Chicago Tribune and New York Daily News.
- Shars of Exxon Mobil Corp. XOM, +0.80% were up 0.2% in premarket trade after the energy giant said it expects higher oil and gas and chemical prices to boost fourth-quarter earnings, but confirmed that it is also expecting to write down $18 to $20 billion of upstream assets. Exxon shares have fallen more than 40% in 2020.
