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 about 0.5 %, while the Dow concluded only a tick above the flatline. U.S. stocks shook off earlier declines after following 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 country.
Shares of Dow component Disney (DIS) reversed earlier profits to fall more than 1 % and guide back out of a record extremely high, after the company posted a surprise quarterly benefit and produced Disney+ streaming prospects more than expected. Newly public company Bumble (BMBL), which set about trading on the Nasdaq on Thursday, rose another seven % after jumping sixty three % in the public debut of its.
Over the past couple weeks, investors have absorbed a bevy of much stronger than expected earnings benefits, with company earnings rebounding faster than expected regardless of the ongoing pandemic. With at least 80 % of companies right now having reported fourth-quarter outcomes, S&P 500 earnings per share (EPS) have topped estimates by seventeen % in aggregate, and bounced back above pre COVID levels, in accordance with an analysis by Credit Suisse analyst Jonathan Golub.
“Prompt and good government action mitigated the [virus related] injury, leading to outsized economic and earnings surprises,” Golub said. “The earnings recovery has been considerably more effective than we could have imagined when the pandemic first took hold.”
Stocks have continued to set up fresh record highs against this backdrop, and as fiscal and monetary policy assistance remain strong. But as investors come to be comfortable with firming business performance, businesses may need to top even bigger expectations in order to be rewarded. This may in turn put some pressure on the broader market in the near term, and also warrant much more astute assessments of specific stocks, in accordance with some strategists.
“It is no secret that S&P 500 performance continues to be very strong over the past several calendar years, driven primarily through valuation expansion. Nonetheless, with the index P/E [price-to-earnings ratio] recently eclipsing its previous dot com high, we think that valuation multiples will start to compress in the coming months,” BMO Capital Markets strategist Brian Belski wrote in a note Thursday. “According to the work of ours, strong EPS growth would be necessary for the following leg higher. Thankfully, that is precisely what current expectations are forecasting. Nonetheless, we in addition discovered that these types of’ EPS-driven’ periods tend to become more challenging from an investment strategy standpoint.”
“We think that the’ easy cash days’ are more than for the time being and investors will need to tighten up the focus of theirs by evaluating the merits of individual stocks, rather than chasing the momentum-laden practices which have recently dominated the expense landscape,” he added.
4:00 p.m. ET: Stocks end higher, S&P 500 and Nasdaq reach record closing highs
Here’s where the key 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 corporate earnings calls: FactSet
Fourth-quarter earnings season represents the very first with President Joe Biden in the White House, bringing a new political backdrop for corporations to contemplate.
Biden’s policies around environmental protections and climate change have been the most-cited political issues brought up on company earnings calls up to this point, in accordance with an analysis from FactSet’s John Butters.
“In terms of government policies mentioned in conjunction with the Biden administration, climate change and energy policy (twenty eight), tax policy (20 COVID-19 and) policy (nineteen) have been cited or perhaps reviewed by probably the highest number of businesses with this point in time in 2021,” Butters wrote. “Of these twenty eight firms, seventeen expressed support (or perhaps a willingness to the office with) the Biden administration on policies to reduce carbon as well as greenhouse gas emissions. These seventeen companies either discussed initiatives to reduce the own carbon of theirs as well as greenhouse gas emissions or maybe services or items they give to help clientele and customers reduce the carbon of theirs and greenhouse gas emissions.”
“However, four businesses also expressed some concerns about the executive order setting up a moratorium on new oil and gas leases on federal lands (and also offshore),” he added.
The list of 28 firms discussing climate change and energy policy encompassed companies from a broad array of industries, including JPMorgan Chase, United Airlines Holdings and 3M, alongside standard oil majors like Chevron.
11:36 a.m. ET: Stocks combined, S&P 500 and Nasdaq turn positive
Here’s in which markets were 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 yield 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 after August in February, in accordance with the Faculty of Michigan’s preliminary once a month survey, as Americans’ assessments of the path ahead for the virus-stricken economy unexpectedly grew more grim.
The headline consumer sentiment index dipped to 76.2 from 79.0 in January, sharply losing out on expectations for a surge to 80.9, as reported by Bloomberg consensus data.
The entire loss of February was “concentrated in the Expectation Index and among households with incomes below $75,000. Households with incomes in the bottom third reported significant setbacks in the present finances of theirs, 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 new round of stimulus payments will bring down fiscal hardships among those with the lowest incomes. Much more shocking was the finding that customers, despite the expected 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’s where 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 deliver 1.19%
9:05 a.m. ET: Equity funds see highest weekly inflows ever as investors pile into tech stocks: Bank of America
Stock cash simply saw 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 profit 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. smaller cap inflows saw their third largest week at $5.6 billion.
Bank of America warned that frothiness is actually rising in markets, nevertheless, as investors keep piling into stocks amid low interest rates, and hopes of a solid recovery for corporate profits and the economy. The firm’s proprietary “Bull and 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 had been the primary actions 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 even 0.17%
Nasdaq futures (NQ=F): 13,711.25, down 17.75 points or even 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 where markets were trading Thursday as over night 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 even 0.1%
Nasdaq futures (NQ=F): 13,703.5, down 25.5 points or 0.19%