S&P 500 futures rise after the benchmark hits one other report shut, and tech is main early features
Futures contracts linked to the S&P 500 rose slightly in early morning trading on Thursday, suggesting Wall Street may extend the gains that pushed the benchmark to record levels this week.
S&P 500 futures gained 0.3%. Futures for the tech-heavy Nasdaq-100 were standout, rising nearly 1%. The futures linked to the Dow Jones Industrial Average remained unchanged.
Facebook, Amazon, Apple, Netflix, and Google parenting alphabet ‘FAANG’ technology stocks were up about 1% higher in premarket trading on Thursday. Chip stocks like Nvidia also gained in early trading.
On Wednesday, a late-day pop hit the S&P 500 at 4,079.95, a new closing high. The Dow Jones Industrial Average rose 16 points, or 0.1%, during the regular session.
The tech-heavy Nasdaq Composite fell 0.1% as big tech stocks outperformed. Amazon, Apple, and Alphabet all rose more than 1%, while Facebook gained 2.2%.
Both the Dow and S&P 500 records close on Monday.
Investors were reassured during Wednesday’s session by the Fed’s latest minutes, which show officials plan to keep the asset buying pace the same for some time as the central bank works to keep prices stable and maximize employment to support.
For Evercore ISI equity strategist Dennis DeBusschere, the market is not entirely convinced that robust economic growth and inflation will not force the hand of the central bank sooner.
“The market predicts the Fed will have to raise rates before saying so,” he said in an email. “The question is whether the Fed will raise rates before inflation has risen above 2% for some time.”
If they stick to their plan, yield curves will steepen as growth prospects improve and the unemployment rate falls, added DeBusschere. “It’s about RESULTS.”
Speaking from Washington on Wednesday, President Joe Biden spoke about his administration’s $ 2 trillion infrastructure plan, which includes an increase in the corporate tax rate to 28%, and said he was ready to negotiate the proposed tax hike.
The proposed corporate income tax hike is seen as the primary source of tax revenue for the White House infrastructure plan and is a non-starter for Republicans who say they are concerned about tax hikes if the U.S. economy emerges from the Covid-19 pandemic.
Separately, the Treasury Department said Biden’s tax proposals would generate approximately $ 2.5 trillion over 15 years to fund eight years of spending on roads, bridges, transit, broadband, and other projects.
Tax support is seen as the main driver behind last month’s share records and strong economic data, including a stronger-than-expected job report from March. The S&P 500, Dow Industrials, and Nasdaq Composite all have their fourth consecutive quarter of earnings as the economic recovery from Covid-19 accelerates.
On Thursday, investors will ponder the latest update from the Department of Labor on the number of Americans filing for unemployment benefits for the first time. Economists polled by Dow Jones expect 694,000 claims in the week to April 3 for the first time.
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