U.S. stock market futures remained flat in trading overnight on Thursday, after major averages closed at new highs.
Futures contracts linked to the Dow Jones industrial average fell 5 points. The future S&P 500 and Nasdaq 100 remained unchanged.
The main averages came from a record-setting session, which caused all three indices to close at highs. During normal trading hours, the Dow advanced 148 points, with a gain of 0.49%. The S&P 500 and Nasdaq Composite hit intraday highs and a record high, gaining 0.58% and 0.84%, respectively.
The highest level came amid optimism around Covid vaccines, as well as hope that Washington will soon reach a consensus on additional stimulus measures.
Capitol Hill leaders said they are approaching an agreement that would provide $ 900 billion in additional aid. The talks, which have been going on for months, are against it, and federal funding expires at 12:01 a.m. ET on Saturday.
Senate Majority Leader Mitch McConnell, R-Ky., Said Thursday that a “bipartisan, bicameral agreement seems to be close.” He noted that it was “very likely” that Congress would work over the weekend and said lawmakers would have to pass a short-term funding measure to gain enough time to pass legislation.
House Speaker Nancy Pelosi, D-California, also said Democrats were approaching consensus. “We have moved forward this morning” and “we look forward to receiving news,” he told reporters Thursday.
The jump in shares on Thursday came despite an increase in Covid cases, in addition to disappointing economic data. Unemployment claims rose to 885,000 last week, reaching their highest level since early September and surpassing the forecast of 808,000. Meanwhile, data released on Wednesday showed that retail sales fell 1.1% in November, more than the 0.3% decline expected by economists.
“The bad news this week is that the third wave continues to get worse and the economic damage from the pandemic continues to rise,” said Brad McMillan, investment director at the Commonwealth Financial Network. “The good news is that the policy is beginning to be successful in containing the virus, and the federal government is likely to pass a stimulus bill, mitigating the two main risk factors.”
McMillan said investors should expect more volatility in the short term, amid the evolution of the stimulus and vaccine plan, before the economy grows again in 2021. “With vaccines available and increasing, we are in the end of the beginning of the pandemic, and the markets recognize it, “he added.
On Thursday evening, Food and Drug Administration advisers overwhelmingly supported Moderna’s Covid vaccine, a key step toward FDA approval of public distribution.
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