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Stock-index futures edged lower Friday, with major benchmarks on track for weekly gains after the S&P 500 index and Nasdaq Composite each logged a record finish in the previous session.
What are major benchmarks doing?
- Futures on the Dow Jones Industrial Average YM00, -0.12% were down 56 points, or 0.2%, at 31,303.
- S&P 500 futures ES00, -0.18% fell 8.15 points, or 0.2%, to 3,903.75.
- Nasdaq-100 futures NQ00, -0.14% were off 19 points, or 0.1%, at 13,710.
The Dow DJIA, -0.02% fell 7.10 points, or less than 0.1%, on Thursday, pulling back from the previous session’s record close, while the S&P 500 SPX, +0.17% and Nasdaq Composite COMP, +0.38% rose slightly, ending at records after two days of small losses.
What’s driving the market?
Stocks were on track for weekly gains, but have seen choppy trading. Support remains tied to expectations Congress will approve another round of aid spending closer to President Joe Biden’s $1.9 trillion proposal, as well as optimism over the continued rollout of COVID-19 vaccines and the falling pace of new cases.
The U.S. is on pace to exceed Biden’s goal of administering 100 million vaccine doses in his first 100 days in office, with more than 26 million shots delivered in his first three weeks. In total, 48 million doses have been given in the U.S., according to a state-by-state tally. In the last week, an average of 1.62 million doses per day were administered.
“While risks remain, the data says we are moving beyond the third wave of the pandemic and the medical risks may be dropping. Similarly, while the economic damage has been real, with economies reopening and the federal stimulus supporting the most vulnerable parts of the economy, we are moving past the worst of it,” said Brad McMillan, chief economist at Commonwealth Financial Network, in a note.
“The most likely case for the next couple of weeks appears to be continued improvement of the medical news, as well as economic improvement as reopenings take effect,” he said. “Markets will likely keep bouncing around on new developments, so expect more volatility in the short term.”
Corporate earnings have also been a positive factor, analysts said. As of Thursday, fourth-quarter earnings per share surpassed prior year levels and four-quarter rolling EPS are now expected to hit records in the second quarter, said Jonathan Golub, chief U.S. equity strategist at Credit Suisse, in a note.
“The earnings recovery has been substantially more robust than we could have imagined when the pandemic first took hold,” he said.
The economic calendar is light on Friday. A preliminary reading of February consumer sentiment is due at 10 a.m. Eastern.
Which companies are in focus?
- Shares of Walt Disney Co. DIS, +0.67% rose1.8% in premarket trade after the entertainment juggernaut late Thursday delivered a surprise fourth-quarter profit, which came as a surge in Disney+ subscriptions led a revenue rebound from the previous quarter.
- S&P Global Ratings said Thursday afternoon it had downgraded Chevron Corp. CVX, -0.54% bonds to AA-, from AA, with a stable outlook. Shares of the oil giant were off 0.6% in premarket trade.
- Shares of Cloudflare Inc. NET, +0.41% were down 6% in premarket action after the cybersecurity company’s results and outlook topped Wall Street expectations on Thursday. The shares have surged nearly 400% over the last 12 months.
- Expedia Group Inc. EXPE, +0.68% late Thursday reported results that showed the continued effects of the COVID-19 pandemic on the travel industry, with gross bookings and revenue each plunging 67% in the fourth quarter. Shares were down 1.9%.
