Stocks finished higher on Friday, with the S&P 500 and Nasdaq closing out the session at record levels.
The S&P 500 and Nasdaq each rose aproximatelly 0.5 %, while the Dow ended just a tick above the flatline. U.S. stocks shook off earlier declines after tracking a drop in overseas equities, after new data showed that UK gross domestic product (GDP) slumped by a record 9.9 % in 2020 as a virus induced recession swept the nation.
Shares of Dow component Disney (DIS) reversed earlier benefits to fall more than one % and take back from a record extremely high, after the company posted a surprise quarterly benefit and produced Disney+ streaming prospects more than expected. Newly public business Bumble (BMBL), which began trading on the Nasdaq on Thursday, rose another 7 % after jumping 63 % in its public debut.
Over the past couple weeks, investors have absorbed a bevy of much stronger than expected earnings results, with corporate profits rebounding much faster than expected despite the ongoing pandemic. With over 80 % of companies now having claimed fourth-quarter outcomes, S&P 500 earnings per share (EPS) have topped estimates by 17 % in aggregate, and bounced back above pre COVID levels, according to an analysis by Credit Suisse analyst Jonathan Golub.
generous government activity and “Prompt mitigated the [virus related] injury, leading to outsized economic and earnings surprises,” Golub said. “The earnings recovery has been substantially more robust than we may have dreamed when the pandemic first took hold.”
Stocks have continued to establish new record highs against this backdrop, and as monetary and fiscal policy assistance remain strong. But as investors come to be used to firming corporate performance, businesses could possibly have to top greater expectations to be rewarded. This could in turn put some pressure on the broader market in the near term, and warrant much more astute assessments of specific stocks, according to some strategists.
“It is no secret that S&P 500 performance has been very powerful over the past several calendar years, driven mostly via valuation expansion. Nevertheless, with the index P/E [price-to-earnings ratio] recently eclipsing its previous dot-com extremely high, we believe that valuation multiples will start to compress in the coming months,” BMO Capital Markets strategist Brian Belski wrote in a note Thursday. “According to our work, strong EPS growth will be important for the next leg higher. Thankfully, that’s precisely what current expectations are forecasting. Nevertheless, we in addition found that these types of’ EPS-driven’ periods tend to be more complicated from an investment strategy standpoint.”
“We believe that the’ easy money days’ are over for the time being and investors will need to tighten up their aim by evaluating the merits of individual stocks, as opposed to chasing the momentum-laden methods that have just recently dominated the expense landscape,” he added.
4:00 p.m. ET: Stocks end higher, S&P 500 and Nasdaq reach record closing highs
Here is where the major stock indexes ended the session:
S&P 500 (GSPC): +18.55 points (+0.47 %) to 3,934.93
Dow (DJI): +27.44 points (+0.09 %) to 31,458.14
Nasdaq (IXIC): +69.70 points (+0.5 %) to 14,095.47
2:58 p.m. ET:’ Climate change’ is the most-cited Biden policy on corporate earnings calls: FactSet
Fourth-quarter earnings season signifies the pioneer with President Joe Biden in the White House, bringing the latest political backdrop for corporations to contemplate.
Biden’s policies around climate change as well as environmental protections have been the most cited political issues brought up on corporate earnings calls so far, in accordance with an analysis from FactSet’s John Butters.
“In terms of government policies mentioned in conjunction with the Biden administration, climate change as well as energy policy (twenty eight), tax policy (20 COVID-19 and) policy (nineteen) have been cited or perhaps talked about by the highest number of businesses through this point in time in 2021,” Butters wrote. “Of these twenty eight companies, seventeen expressed support (or a willingness to work with) the Biden administration on policies to greatly reduce carbon as well as greenhouse gas emissions. These 17 firms both discussed initiatives to minimize their own carbon and greenhouse gas emissions or maybe services or items they provide to support clientele & customers reduce their carbon and greenhouse gas emissions.”
“However, four companies also expressed a number of concerns about the executive order establishing a moratorium on new engine oil and gas leases on federal lands (and offshore),” he added.
The list of 28 firms discussing climate change as well as energy policy encompassed organizations from an extensive array of industries, including JPMorgan Chase, United Airlines Holdings and 3M, alongside traditional oil majors like Chevron.
11:36 a.m. ET: Stocks mixed, S&P 500 and Nasdaq turn positive
Here is in which marketplaces had been trading Friday intraday:
S&P 500 (GSPC): +7.87 points (+0.2 %) to 3,924.25
Dow (DJI): 8.77 points (-0.03 %) to 31,421.93
Nasdaq (IXIC): +28.15 points (+0.21 %) to 14,053.77
Crude (CL=F): +$0.65 (+1.12 %) to $58.89 a barrel
Gold (GC=F): +$0.20 (+0.01 %) to $1,827.00 per ounce
10-year Treasury (TNX): +2.7 bps to deliver 1.185%
10:15 a.m. ET: Consumer sentiment suddenly plunges to a six-month lower in February: U. Michigan
U.S. consumer sentiment slid to the lowest level after August in February, based on the University of Michigan’s preliminary monthly survey, as Americans’ assessments of the road forward for the virus stricken economy suddenly grew more grim.
The headline consumer sentiment index dipped to 76.2 from 79.0 in January, sharply losing out on expectations for a surge to 80.9, based on Bloomberg consensus data.
The whole loss of February was “concentrated in the Expectation Index and among households with incomes under $75,000. Households with incomes in the bottom third reported major setbacks in their present finances, with fewer of the households mentioning recent income gains than whenever after 2014,” Richard Curtin chief economist for the university’s Surveys of Consumers, said in a statement.
“Presumably a new round of stimulus payments will lessen fiscal hardships with those with probably the lowest incomes. Much more shocking was the finding that consumers, despite the expected passage of a grand stimulus bill, viewed prospects for the national economy less favorably in early February compared to more month,” he added.
9:30 a.m. ET: Stocks open lower, but pace toward posting weekly gains
Here’s where markets had been trading just after the opening bell:
S&P 500 (GSPC): 8.31 points (0.21 %) to 3,908.07
Dow (DJI): -19.64 (0.06 %) to 31,411.06
Nasdaq (IXIC): 53.51 (+0.41 %) to 13,970.45
Crude (CL=F): -1dolar1 0.23 (-0.39 %) to $58.01 a barrel
Gold (GC=F): -1dolar1 10.70 (0.59 %) to $1,816.10 per ounce
10-year Treasury (TNX): +3.2 bps to deliver 1.19%
9:05 a.m. ET: Equity funds see highest weekly inflows ever as investors pile into tech stocks: Bank of America
Stock cash simply discovered their largest-ever week of inflows for the period ended February 10, with inflows totaling a record $58.1 billion, as reported by Bank of America. Investors pulled a total of $800 million out of gold and $10.6 billion out of money during the week, the firm added.
Tech stocks in turn saw their own record week of inflows at $5.4 billion. U.S. large cap stocks saw the second-largest week of theirs of inflows ever at $25.1 billion, and U.S. small cap inflows saw their third largest week at $5.6 billion.
Bank of America warned that frothiness is rising in markets, nevertheless, as investors keep piling into stocks amid low interest rates, and hopes of a solid recovery for the economy and corporate profits. The firm’s proprietary “Bull and Bear Indicator” monitoring market sentiment rose to 7.7 from 7.5, nearing an 8.0 “sell” signal.
7:14 a.m. ET Friday: Stock futures point to a lower open
The following were the principle actions in markets, as of 7:16 a.m. ET Friday:
S&P 500 futures (ES=F): 3,904.00, down 8.00 points or even 0.2%
Dow futures (YM=F): 31,305.00, down fifty four points or even 0.17%
Nasdaq futures (NQ=F): 13,711.25, down 17.75 points or perhaps 0.13%
Crude (CL=F): -1dolar1 0.43 (-0.74 %) to $57.81 a barrel
Gold (GC=F): -1dolar1 9.50 (0.52 %) to $1,817.30 per ounce
10-year Treasury (TNX): +0.5 bps to deliver 1.163%
6:03 p.m. ET Thursday: Stock futures tick higher
Here’s in which markets were trading Thursday as over night trading kicked off:
S&P 500 futures (ES=F): 3,904.50, printed 7.5 points or 0.19%
Dow futures (YM=F): 31,327.00, down 32 points or perhaps 0.1%
Nasdaq futures (NQ=F): 13,703.5, down 25.5 points or even 0.19%