US stock futures fell slightly lower on Friday as some investors worried that President-elect Joe Biden’s $ 1.9 trillion Covid-19 plan could lead to higher taxes.
Futures pegged to the S&P 500 fell 0.3%, indicating that the reference index may fall for a second day. Contracts linked to the Nasdaq-100 fell less than 0.1% lower and contracts linked to the Dow Jones Industrial Average fell 0.3%.
The S&P 500 is on track to close out the week lower, pushing some of the gains made in early January as the gauge rebounded to record highs. Markets have been cheering for weeks on Democrats’ plans to expand government spending and bolster economic recovery. But the magnitude of Mr. Biden’s plans, drawn up late on Thursday, served to curb some of that optimism.
“The size was clearly surprising on the upside,” said Wei Li, head of investment strategy for BlackRock ‘s exchange traded funds and index investments for Europe, the Middle East and Africa. “With the majority of the Senate, [taxes] could come in the medium term and that is something the market must also assess. ”
Investors hope that additional spending will help put the US economy through a winter with high Covid-19 infection rates and worsening economic data. Figures released Thursday show that the number of workers claiming unemployment benefits is making the largest weekly profit since the pandemic last March.