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 concluded just 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 record 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 one % and guide back from a record high, after the company posted a surprise quarterly profit and cultivated Disney+ streaming prospects more than expected. Newly public business Bumble (BMBL), which set about 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 much stronger than expected earnings benefits, with company profits rebounding faster than expected regardless of the ongoing pandemic. With more than 80 % of businesses now having claimed 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 generous government activity mitigated the [virus-related] damage, leading to outsized economic and earnings surprises,” Golub said. “The earnings recovery has been substantially 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 come to be used to firming business performance, businesses may need to top even greater expectations in order to be rewarded. This may in turn put some pressure on the broader market in the near-term, and warrant more astute assessments of specific stocks, based on some strategists.
“It is actually no secret that S&P 500 performance has long been quite strong over the past few calendar years, driven primarily via valuation development. Nevertheless, with the index P/E [price-to-earnings ratio] recently eclipsing its previous dot com high, we think that valuation multiples will begin to compress in the coming months,” BMO Capital Markets strategist Brian Belski wrote in a note Thursday. “According to our job, strong EPS growth is going to be important for the next leg greater. Fortunately, that’s exactly what present expectations are forecasting. But, we in addition discovered that these kinds of’ EPS-driven’ periods tend to be more tricky from an investment strategy standpoint.”
“We believe that the’ easy money days’ are actually more than for the time being and investors will have to tighten up the focus of theirs by evaluating the merits of individual stocks, instead of chasing the momentum laden strategies who have just recently dominated the investment landscape,” he added.
4:00 p.m. ET: Stocks end higher, S&P 500 and Nasdaq reach record closing highs
Here is where the major 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’ would be the most-cited Biden policy on corporate earnings calls: FactSet
Fourth-quarter earnings season marks the pioneer 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 corporate 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 and energy policy (28), tax policy (twenty COVID-19 and) policy (nineteen) have been cited or maybe discussed by probably the highest number of businesses through this point on time in 2021,” Butters wrote. “Of these 28 companies, 17 expressed support (or a willingness to work with) the Biden administration on policies to greatly reduce carbon as well as greenhouse gas emissions. These 17 corporations possibly discussed initiatives to reduce the own carbon of theirs as well as greenhouse gas emissions or perhaps items or services they supply to help clientele & customers reduce their carbon 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 offshore),” he added.
The list of twenty eight firms discussing climate change and energy policy encompassed businesses from a broad array of industries, including JPMorgan Chase, United Airlines Holdings and 3M, alongside traditional oil majors like Chevron.
11:36 a.m. ET: Stocks combined, S&P 500 and Nasdaq turn positive
Here’s in which marketplaces 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 suddenly plunges to a six month lower in February: U. Michigan
U.S. consumer sentiment slid to the lowest level since August in February, in accordance with the Faculty of Michigan’s preliminary month to month survey, as Americans’ assessments of the path forward for the virus stricken economy unexpectedly grew more grim.
The headline consumer sentiment index dipped to 76.2 from 79.0 in January, sharply missing expectations for a rise to 80.9, as reported by Bloomberg consensus data.
The whole loss in February was “concentrated in the Expectation Index and among households with incomes below $75,000. Households with incomes of the bottom third reported considerable setbacks in their current finances, with fewer of these households mentioning recent income gains than whenever after 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 bring down financial hardships among those with probably 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 than last month,” he added.
9:30 a.m. ET: Stocks open lower, but pace toward posting weekly gains
Here’s where markets 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 deliver 1.19%
9:05 a.m. ET: Equity funds see highest weekly inflows actually 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 10, with inflows totaling a record $58.1 billion, based on 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 the second-largest week of theirs of inflows ever at $25.1 billion, and U.S. tiny cap inflows saw the third-largest week of theirs at $5.6 billion.
Bank of America warned that frothiness is rising in markets, nevertheless, as investors keep piling into stocks amid low interest rates, and hopes of a strong 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 were the principle movements 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 even 0.17%
Nasdaq futures (NQ=F): 13,711.25, down 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 where marketplaces had been trading Thursday as overnight trading kicked off:
S&P 500 futures (ES=F): 3,904.50, printed 7.5 points or even 0.19%
Dow futures (YM=F): 31,327.00, down thirty two points or 0.1%
Nasdaq futures (NQ=F): 13,703.5, printed 25.5 points or perhaps 0.19%