Tourists take a picture with the market bull near the New York Stock Exchange.
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Future contracts linked to major U.S. stock indices rose Thursday night just hours after the S&P 500 closed at a record high and President Joe Biden signed scientific stimulus legislation.
Dow futures added 60 points and suggested a profit of a similar magnitude when regular trading resumes Friday. Nasdaq 100 and S&P 500 futures contracts both added about 0.2%.
U.S. stocks climbed to a record high during Thursday’s regular session, when a recovery in technology stocks resumed and Biden’s $ 1.9 billion Covid-19 aid package became legal. The S&P 500 jumped by 1% and reached a new high, surpassing the previous record from 16 February.
The Dow Jones industrial average, the relative deficit, scored 188.57 points after gaining more than 300 points to an intraday record earlier in the session.
“While we expect conditions to remain volatile, recent developments point to three of the key market drivers – stimulus, pandemic news and inflation data – on further upside stocks,” wrote Mark Haefele, chief investment officer of UBS Global Wealth Management.
“The stimulus is significantly larger than expected earlier in the year. Its provision is also likely to be very supportive of consumption and growth,” he added, referring to the stimulus. “This windfall comes in addition to the existing signs of a pent-up demand from US consumers.”
While the S&P 500 set a new closing record, the Nasdaq Composite achieved the best profit of the day, rising 2.5% amid a return to popular technology stocks. The movements that had the index higher have a rise of 4.7% in Tesla and a rise of at least 3% in Apple, Facebook, Alphabet and Netflix.
The Nasdaq is clearing out a 10% correction it made earlier this month and remains 5.48% below its own record set in February.
A rapid rise in bond yields put the technology index under pressure earlier in March as investors moved to economically sensitive, cyclical stocks. Sharp rise in interest rates could put huge pressure on technology stocks as it reduces the relative value of future gains.
It appears that the trend partially reversed on Thursday when bond yields calmed down; the Nasdaq has risen 3.7% so far this week and is better than the S&P 500 and the Dow over the period. The ten-year treasury yield, which peaked at about 1.6% this month, was last seen north of 1.53%.
Signs that the U.S. economy could be set for a healthy 2021 were plentiful Thursday after Biden signed into law the long-awaited $ 1.9 billion coronavirus relief package. The plan will send direct payments of up to $ 1,400 to many Americans, and will also bring in nearly $ 20 billion in Covid-19 vaccinations and $ 350 billion in state, local and tribal government assistance.
Biden announced Thursday night that he would order states to qualify all adults for the vaccine by May 1 in his first speech as president.
Investors also welcomed a slightly better-than-expected reading on weekly unemployment claims, which showed a decline in the number of first-time unemployment benefit applicants.