U.S. stock indexes were moderately lower at noon Friday after setting new highs this week as reports have shown lockdown measures to tackle the COVID-19 pandemic are having an economic impact in Europe and the new cycle stimulus package proposed by President Joe Biden is facing opposition in the Senate.
How are stock market indices performing?
The Dow Jones Industrial Average DJIA
was down about 83 points to 31,093, a decrease of 0.3%.
The S&P 500 SPX Index
traded 3 points less, or 0.1%, to reach 3850.
The Nasdaq COMP Composite Index
was down 7 points to 13,524.
On Thursday, the Dow Jones fell 12.37 points, or less than 0.1%, to 31,176.01, the S&P 500 gained 1.22 points, or less than 0.1%, to 3,853.07, reaching narrowly set a record closing record, as did the Nasdaq Composite, which climbed 73.67 points, or 0.6%, to 13,530.91.
What drives the market?
Investors find little reason to buy stocks on Friday after a series of record highs this week, with the acceleration of new coronavirus cases and lockdowns around the world undermining support for stocks.
The global tally of confirmed COVID-19 cases climbed above 97.5 million on Friday, according to data aggregated by Johns Hopkins University, while the death toll topped 2.09 million.
British Prime Minister Boris Johnson has said the country’s current lockdowns could last until the summer. Cases of COVID-19 are also being reported again in China for the first time in months, with 103 new infections, as Hong Kong experienced its first lockdown, just ahead of the Lunar New Year festivities, a popular holiday in Asia. .
In the United States, Dr Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, returned to the daily White House briefing on Thursday and said new data shows vaccines currently on the market could be less effective in combating variants of COVID-19.
Data showed that the flash Eurozone purchasing managers’ index fell in January to a two-month low, raising the possibility of another recession.
But US stocks came out of their session low after IHS Markit’s surveys of purchasing managers for the US services and manufacturing sectors performed well compared to December. The services index – by far the largest sector of the economy – hit a two-month high of 57.5 in January, down from 54.8 the previous month, while a survey of the manufacturing sector American climbed to a record 59.1 from 57.1. Both readings suggest that the US economy is starting off solidly in 2021.
Sales of existing homes in the United States in December rose less than 1% to 6.76 million, the National Association of Realtors said.
Hopes are high for decisive action by the Biden administration, both on public health and the economic crisis, and markets are likely to just walk on water pending some clarity, said Keith Hembre, director. investments from Minneapolis-based Liniam Capital.
“Without some kind of catalyst to push things higher, I think the gravitational pull is probably flat, if not slightly lower, given the valuation situation and the fact that there has been a lot of force to push up. the market since November, and it’s probably starting to decline. a little, ”Hembre said in an interview.
Analysts doubt that a $ 1.9 billion relief plan proposed by Biden will remain intact in the Senate as the new president seeks consensus in Congress on new budget spending.
But Hembre is thinking of something big – a new round of tax spending, a clear sense of progress in vaccine rollout, or even big, positive earnings surprises from companies, like Netflix Inc.’s NFLX.
recent results – is needed to shake the markets beyond the current holding pattern.
“I would say there has been a much more optimistic disposition from market participants as well,” Hembre said. This means that there could be opportunities for some of the air to exit the market in the coming weeks.
Investors are also concerned that the Senate impeachment process against former President Donald Trump could delay progress on Biden’s fiscal stimulus bill. Former President Donald Trump’s articles of impeachment are expected to be delivered to the Senate on Monday. The House voted last week to impeach Trump, for the second time, alleging that the 45th president incited a crowd that stormed the U.S. Capitol on Jan.6.
Investors are also watching quarterly results, with a focus on Intel Corp INTC whose shares fell early Friday after releasing results Thursday night on its plans to address longer-term issues.
In addition, International Business Machines Corp. IBM on Thursday afternoon reported a decline in adjusted net income for at least the seventh consecutive year and a decline in sales for the eighth year of the past nine, according to FactSet Records.
Separately, the appointment of former Federal Reserve Chairman Janet Yellen as Secretary of the Treasury, becoming the first woman to hold the post, obtained unanimous consent from the Senate Finance Committee and is expected to be confirmed by the Senate. entire Senate.
What stocks are targeted?
Walt disney co. Dis
was upgraded to buy neutral at UBS, with the broker raising its price target on the entertainment giant to $ 200 from $ 155. The shares rose 0.8%.
was down almost 10% a day after its quarterly update.
Intelactions of INTC
slipped more than 8% on Friday.
Actions of Schlumberger Ltd.
were at the center of concerns after the oil services company exceeded its profit forecast and exceeded revenue guidance for the first time in four quarters. The shares were down 0.3%.
Aurora Cannabis IncACB of.
$ 125 million bought deal financing is not surprising, but may not be enough for the Canadian company to gain a foothold in the United States, Jefferies analyst Owen Bennett said Friday. The shares were off 6.9% early Friday.
Actions of Climate crisis Real impact I Acquisition Corp. CLII
climbed nearly 60% after the special purpose acquisition company announced a deal in which EVgo Services LLC will go public. EVgo, which boasts of being the “nation’s largest public electric vehicle fast-charging network,” said it expects $ 575 million in proceeds from the merger deal, values the company combined to $ 2.6 billion.
How are the other assets doing?
The yield of the 10-year BX Treasury bill: TMUBMUSD10Y
slipped 1.8 basis points to around 1.09% as investors took a risky tone on Friday. Bond yields and prices move in opposite directions.
The ICE US dollar DXY index,
a measure of the currency against a basket of six big rivals, was up 0.1% on the day but heading for a weekly decline of 0.5%.
Oil futures traded significantly lower as the spread of COVID-19 in Europe and Asia became more concentrated, with the US benchmark CL
1.3% less at $ 52.42 per barrel. GC00 Gold Futures
retreated as the dollar rose slightly, with February contract GCG21
down 0.7% to $ 1,852.10 an ounce.
In Europe, the Stoxx 600 Europe XX: SXXP index
closed down 0.6%, while London’s FTSE 100 UK: UKX
In Asian trade, the Shanghai Composite CN: SHCOMP
fell 0.4%, China’s CSI 300 XX: 000300
closed up less than 0.1%, while the Hong Kong HK: HSI Hang Seng Index
fell 1.6% and the Japanese Nikkei 225 JP: NIK
closed 0.4% lower.