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 %, even though the Dow ended 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 profits to fall more than 1 % and pull back from a record extremely high, after the company posted a surprise quarterly benefit and grew Disney+ streaming subscribers more than expected. Newly public organization Bumble (BMBL), which started trading on the Nasdaq on Thursday, rose another seven % after jumping sixty three % in its public debut.
Over the older couple weeks, investors have absorbed a bevy of stronger than expected earnings benefits, with corporate earnings rebounding faster than expected inspite of the continuous pandemic. With at least eighty % of companies right now having reported fourth quarter results, S&P 500 earnings per share (EPS) have topped estimates by 17 % for aggregate, and bounced back above pre COVID amounts, based on an analysis by Credit Suisse analyst Jonathan Golub.
“Prompt and good government activity mitigated the [virus-related] damage, leading to outsized economic and earnings surprises,” Golub said. “The earnings recovery has been considerably more powerful than we could have dreamed when the pandemic first took hold.”
Stocks have continued to set fresh record highs against this backdrop, and as monetary and fiscal policy support remain robust. But as investors become comfortable with firming corporate performance, businesses might need to top even bigger expectations to be rewarded. This can in turn put some pressure on the broader market in the near-term, and warrant more astute assessments of specific stocks, according to some strategists.
“It is no secret that S&P 500 performance has been extremely formidable over the past few calendar years, driven largely through valuation expansion. But, with the index P/E [price-to-earnings ratio] recently eclipsing its previous dot com extremely 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 our job, strong EPS growth would be required for the following leg higher. Thankfully, that’s exactly what current expectations are forecasting. But, we also discovered that these sorts of’ EPS-driven’ periods tend to be challenging from an investment strategy standpoint.”
“We assume that the’ easy money days’ are over for the time being and investors will need to tighten up their focus by evaluating the merits of specific stocks, rather than chasing the momentum-laden practices who have just recently dominated the expense landscape,” he added.
4:00 p.m. ET: Stocks end higher, S&P 500 and Nasdaq reach history closing highs
Here’s exactly where the key stock indexes ended 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 marks 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 as well as climate change have been the most cited political issues brought up on corporate earnings calls thus far, based on 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 (19) have been cited or talked about by the highest number of businesses with this point on time in 2021,” Butters wrote. “Of these twenty eight firms, seventeen expressed support (or perhaps a willingness to your workplace with) the Biden administration on policies to greatly reduce carbon and greenhouse gas emissions. These seventeen companies both discussed initiatives to reduce their own carbon and greenhouse gas emissions or perhaps items or services they provide to assist customers and customers reduce their carbon and greenhouse gas emissions.”
“However, four companies also expressed some concerns about the executive order setting up a moratorium on new engine oil as well as gas leases on federal lands (and also offshore),” he added.
The list of 28 companies discussing climate change as well as energy policy encompassed companies from a diverse array of industries, including JPMorgan Chase, United Airlines Holdings and 3M, alongside conventional oil majors like Chevron.
11:36 a.m. ET: Stocks mixed, 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 deliver 1.185%
10:15 a.m. ET: Consumer sentiment suddenly plunges to a six-month low in February: U. Michigan
U.S. consumer sentiment slid to probably the lowest level since August in February, according to the Faculty of Michigan’s preliminary monthly survey, as Americans’ assessments of the road ahead for the virus-stricken economy unexpectedly grew much more grim.
The title 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 in February was “concentrated in the Expectation Index and involving households with incomes below $75,000. Households with incomes in the bottom third reported major setbacks in their present finances, with fewer of the households mentioning latest income gains than whenever 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 the lowest incomes. 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 compared to last month,” he added.
9:30 a.m. ET: Stocks open lower, but speed toward posting weekly gains
Here’s in which marketplaces were trading only 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 ever as investors pile into tech stocks: Bank of America
Stock funds simply saw their largest ever week of inflows for the period ended February ten, with inflows totaling a record $58.1 billion, according to Bank of America. Investors pulled a total of $800 million out of gold and $10.6 billion out of cash throughout 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 the second largest week of theirs of inflows ever at $25.1 billion, and U.S. small cap inflows saw the third largest week of theirs at $5.6 billion.
Bank of America warned that frothiness is actually rising in markets, nevertheless, as investors keep on piling into stocks amid low interest rates, as well as hopes of a solid recovery for corporate earnings and the economy. The firm’s proprietary “Bull as well as Bear Indicator” tracking 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 main actions 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 54 points or even 0.17%
Nasdaq futures (NQ=F): 13,711.25, down 17.75 points or perhaps 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 yield 1.163%
6:03 p.m. ET Thursday: Stock futures tick higher
Here is in which marketplaces were trading Thursday as over night trading kicked off:
S&P 500 futures (ES=F): 3,904.50, down 7.5 points or even 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 0.19%