US stock futures hovered between gains and losses as investors checked whether Covid-19 infections and deteriorating economic data would prompt lawmakers to bolster a coronavirus aid package.
Futures pegged to the S&P 500 were up 0.1%, suggesting that the benchmark stock gauge will open relatively unchanged after hitting a new high on Thursday. Futures linked to the technology-focused Nasdaq-100 advanced 0.1%.
Top Republicans and Democrats are approaching a coronavirus aid package that would send direct payments to many Americans, improve unemployment benefits, provide assistance to small businesses, and fund the distribution of the Covid-19 vaccine, among other measures.
Investors have welcomed the prospect of additional fiscal stimulus in recent days as high Covid-19 infections and measures to contain their spread have weighed on the economy. Data released Thursday shows that the number of workers seeking unemployment benefits has reached its highest point in three months.
“The US economy has clearly deteriorated,” said Luca Paolini, chief strategist at Pictet Asset Management. “The market expects tax incentives. There will be a big disappointment if there is no agreement. “
In off-hours trading, shares in FedEx fell 3.3% after the delivery company beat analyst earnings expectations, but said higher earnings were partially offset by higher costs, including from safety equipment to protect workers from Covid-19.
Shares in Darden Restaurants,
operator of Olive Garden and LongHorn Steakhouse, fell 1.8% for the market after sales fell more than analysts expected in the last quarter. Income updates are payable by Nike after the closing bell.
Tesla’s stock could jump ahead before entering the S&P 500 next week. Dozens of index funds tracking the S&P 500 will have to buy tens of billions of dollars in stocks by Friday’s closing price to track the index as closely as possible.
Friday also brings “quadruple witching”, where options and futures of major indices and stocks expire simultaneously. The higher trading volumes could create volatility as well as greater opportunities for funds to add Tesla shares.
Stocks in Asia were predominantly lower. The Wall Street Journal reported that US officials were debating how broadly to list Chinese companies excluded from investment by Americans because of ties to the Chinese military. China’s Shanghai Composite Index closed 0.3% lower and Hong Kong’s Hang Seng fell 0.7%. Japan’s Nikkei 225 index fell 0.2%.
Shares in Semiconductor Manufacturing International Corp.
Hong Kong trade fell 5.2% after the Trump administration added China’s largest computer chip manufacturer to the export blacklist, limiting the company’s access to high-end technology.
The pan-continental Stoxx Europe 600 rose 0.1%. Investors kept a close eye on the negotiations between the UK and the European Union on a post-Brexit trade deal. Some expect the British pound to rise further if a deal is reached. European negotiators have said they want a deal on Sunday. The pound has gained 2.4% against a largely weaker dollar this week.
“The clock is running,” said Hugh Gimber, a strategist at JP Morgan Asset Management.
In the bond markets, the yield on 10-year Treasury notes rose to 0.936%, from 0.929% Thursday. Revenues rise when prices fall.
A Christmas tree decoration with the logo of the New York Stock Exchange, in Manhattan’s financial district.
Photo:
jeenah moon / Reuters
Write to Caitlin Ostroff at [email protected]
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