Stocks ended 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 aproximatelly 0.5 %, while the Dow finished only a tick above the flatline. U.S. stocks shook off earlier declines after tracking a drop in overseas equities, after new data showed that UK gross domestic product (GDP) slumped by a report 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 take back from a record extremely high, after the company posted a surprise quarterly profit and cultivated Disney+ streaming prospects much more than expected. Newly public organization Bumble (BMBL), which began trading on the Nasdaq on Thursday, rose another 7 % after jumping 63 % in its public debut.
Over the older couple weeks, investors have absorbed a bevy of much stronger than expected earnings results, with company profits rebounding much faster than expected regardless of the continuous pandemic. With over 80 % of companies right now having reported fourth-quarter outcomes, S&P 500 earnings per share (EPS) have topped estimates by 17 % in aggregate, and bounced back above pre-COVID levels, based on an analysis by Credit Suisse analyst Jonathan Golub.
good government activity and “Prompt mitigated the [virus related] damage, leading to outsized economic and earnings surprises,” Golub said. “The earnings recovery has been substantially more effective than we may have imagined when the pandemic for starters took hold.”
Stocks have continued to set fresh record highs against this backdrop, and as monetary and fiscal policy support stay strong. But as investors become accustomed to firming business functionality, businesses might need to top even bigger expectations in order to be rewarded. This can in turn put some pressure on the broader market in the near term, and warrant more astute assessments of individual stocks, according to some strategists.
“It is no secret that S&P 500 performance has long been very powerful over the past few calendar years, driven largely via valuation development. Nevertheless, with the index P/E [price-to-earnings ratio] recently eclipsing its previous 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 work, strong EPS growth is going to be necessary for the next leg higher. Fortunately, that is exactly what present expectations are forecasting. Nevertheless, we in addition found that these sorts of’ EPS-driven’ periods tend to become more complicated from an investment strategy standpoint.”
“We assume that the’ easy cash days’ are actually more than for the time being and investors will need to tighten up their focus by evaluating the merits of specific stocks, instead of chasing the momentum laden strategies who have recently dominated the investment landscape,” he added.
4:00 p.m. ET: Stocks end higher, S&P 500 and Nasdaq reach history closing highs
Here is where the main 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’ will be 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 an innovative political backdrop for corporations to contemplate.
Biden’s policies around environmental protections as well as climate change have been the most-cited political issues brought up on company earnings calls up to this point, according to an analysis from FactSet’s John Butters.
“In terms of government policies mentioned in conjunction with the Biden administration, climate change as well as energy policy (28), tax policy (20 ) and COVID-19 policy (nineteen) have been cited or reviewed by the highest number of businesses with this point in time in 2021,” Butters wrote. “Of these twenty eight firms, seventeen expressed support (or a willingness to work with) the Biden administration on policies to reduce carbon and greenhouse gas emissions. These 17 firms both discussed initiatives to minimize the own carbon of theirs as well as greenhouse gas emissions or perhaps services or merchandise they provide to help clients & customers reduce the carbon of theirs and greenhouse gas emissions.”
“However, 4 companies also expressed a number of concerns about the executive order establishing a moratorium on new engine oil and gas leases on federal lands (and offshore),” he added.
The list of 28 companies discussing climate change and energy policy encompassed companies from an extensive array of industries, like JPMorgan Chase, United Airlines Holdings and 3M, alongside traditional oil majors as Chevron.
11:36 a.m. ET: Stocks combined, S&P 500 and Nasdaq turn positive
Here is where markets 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 lower in February: U. Michigan
U.S. consumer sentiment slid to the lowest level since August in February, according to the University of Michigan’s preliminary monthly survey, as Americans’ assessments of the path forward for the virus-stricken economy suddenly grew more grim.
The headline consumer sentiment index dipped to 76.2 from 79.0 in January, sharply losing out on expectations for a rise to 80.9, according to Bloomberg consensus data.
The entire loss of February was “concentrated in the Expectation Index and involving households with incomes under $75,000. Households with incomes in the bottom third reported considerable setbacks in their current finances, with fewer of the households mentioning latest income gains than anytime since 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 lessen fiscal hardships among those with probably the lowest incomes. A lot more shocking was the finding that consumers, despite the likely passage of a large stimulus bill, viewed prospects for the national economy less favorably in early February than last month,” he added.
9:30 a.m. ET: Stocks open lower, but pace toward posting weekly gains
Here is in which markets had been trading simply 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 yield 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 ten, with inflows totaling a record $58.1 billion, as reported by 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 during $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 their third largest week at $5.6 billion.
Bank of America warned that frothiness is rising in markets, however, as investors keep piling into stocks amid low interest rates, and hopes of a good recovery for the economy and corporate earnings. The firm’s proprietary “Bull as well as Bear Indicator” monitoring 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
Here were the main moves in markets, as of 7:16 a.m. ET Friday:
S&P 500 futures (ES=F): 3,904.00, printed 8.00 points or even 0.2%
Dow futures (YM=F): 31,305.00, down fifty four points or 0.17%
Nasdaq futures (NQ=F): 13,711.25, printed 17.75 points or 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’s in which markets were trading Thursday as overnight trading kicked off:
S&P 500 futures (ES=F): 3,904.50, down 7.5 points or 0.19%
Dow futures (YM=F): 31,327.00, down 32 points or 0.1%
Nasdaq futures (NQ=F): 13,703.5, down 25.5 points or even 0.19%