Future U.S. stock markets fluctuated between gains and losses as investors monitored whether Covid-19 infections and worsening economic data would push lawmakers to consolidate a coronavirus aid package.
Futures linked to the S&P 500 rose 0.1%, suggesting that the benchmark indicator will open relatively unchanged after breaking another record closed on Thursday. Technology-focused Nasdaq-100 futures advanced 0.1%.
Leading Republicans and Democrats are closing a coronavirus relief package that would send direct payments to many Americans, increase unemployment benefits, provide help to small businesses, and fund the distribution of the Covid-19 vaccine, among other measures. .
Investors have encouraged the prospect of additional fiscal stimulus in recent days, as severe Covid-19 infections and measures to contain their spread have weighed on the economy. Data released on Thursday showed that the number of workers applying for unemployment benefits had reached a maximum of three months.
“There is a clear deterioration in the US economy,” said Luca Paolini, chief strategist at Pictet Asset Management. “The market expects a fiscal stimulus. There will be great disappointment if there is no agreement. “
In overtime trading, FedEx shares fell 3.3% after the delivery company exceeded analysts ’profit expectations, but said higher revenues were partially offset by increased costs, including safety equipment to protect Covid-19 workers.
Actions in Darden restaurants,
operator of Olive Garden and LongHorn Steakhouse, fell 1.8% ahead of the market after sales fell more than analysts expected in its last quarter. Earnings updates are due to Nike after the bell closes.
Tesla shares could advance ahead of its inclusion in the S&P 500 next week. Tens of index funds following the S&P 500 will have to buy tens of billions of dollars worth of shares at Friday’s closing price to follow the index as closely as possible.
Friday also features a “quadruple witch,” in which options and futures on major indices and stocks expire simultaneously. Higher trading volumes could bring volatility, but also more opportunities for funds to add Tesla shares.
Stocks in Asia were mostly lower. The Wall Street Journal reported that U.S. officials were debating the breadth of making a list of Chinese companies banned from investing by Americans because of ties to the Chinese military. Shanghai’s composite index in China closed 0.3% lower and Hong Kong’s Hang Seng fell 0.7%. The Japanese Nikkei 225 index fell 0.2%.
Shares of Semiconductor Manufacturing International Corp.
fell 5.2% in Hong Kong trade after the Trump administration added the largest Chinese computer chip maker to the blacklist of exports, which restricted the company’s access to high-end technology.
The Pan-Continental Stoxx Europe 600 rose 0.1%. Investors were watching closely the negotiations between the UK and the European Union on a post-Brexit trade deal. Some expect the British pound to rise further if an agreement is reached. European negotiators have said they want a deal by Sunday. The pound sterling has risen 2.4% this week against a generally weaker dollar.
“The clock is running out,” said Hugh Gimber, strategist at JP Morgan Asset Management.
In bond markets, the yield on 10-year Treasury bills rose to 0.936% from 0.929% on Thursday. Yields increase when prices fall.
A Christmas tree decoration with the New York Stock Exchange logo in the Manhattan financial district.
Photo:
jeenah moon / Reuters
Write to Caitlin Ostroff to [email protected]
Copyright © 2020 Dow Jones & Company, Inc. All rights reserved. 87990cbe856818d5eddac44c7b1cdeb8