U.S. stock futures declined on Tuesday, indicating that major indices could breathe after signs of a rapid economic recovery pushed them to record highs.
Futures linked to the S&P 500 fell 0.1%, a day after the benchmark large-cap stock reached its 17th all-time high in 2021. Contracts for the Dow Jones industrial average, which on Monday they reached a new high for the 18th time this year, it also fell 0.1%. The futures of the Nasdaq-100 index, which has had a lot of technology, were relatively flat.
Stocks have jumped at the start of the second quarter, amid optimism that government spending, vaccines and easing restrictions are triggering a period of rapid economic growth. A number of data have shown that the rise in activity and recruitment is taking place a year after the pandemic crashed the brakes on the economy. Investors are betting that sectors such as banking and mining will benefit from the reopening. Technology stocks have also risen after faltering at times in the first quarter.
“It simply came to our notice then [economy] just hit the accelerator, ”said Brian O’Reilly, head of market strategy at Mediolanum International Funds. The recent rally shows signs of being broad and does not focus only on economically sensitive sectors that suffered the most from the 2020 pandemic, he added. “We have certainly seen a moderation in the one-way bet that was being made until mid-March.”
The Cboe volatility index, which measures projected changes in the S&P 500 based on option prices, rose to 18.04. It is close to its lowest level since before the pandemic markets began to erupt in late February 2020.