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 about 0.5 %, while the Dow ended only a tick above the flatline. U.S. stocks shook off earlier declines after following a drop in overseas equities, after new data showed that UK gross domestic product (GDP) slumped by a report 9.9 % in 2020 as a virus induced recession swept the country.
Shares of Dow component Disney (DIS) reversed earlier profits to fall more than 1 % and pull back from a record extremely high, after the company posted a surprise quarterly profit and grew Disney+ streaming subscribers more than expected. Newly public organization Bumble (BMBL), which started trading on the Nasdaq on Thursday, rose another 7 % after jumping 63 % in its public debut.
Over the older couple weeks, investors have absorbed a bevy of stronger than expected earnings results, with company profits rebounding much faster than expected regardless of the continuous pandemic. With at least 80 % of companies now having reported fourth-quarter results, S&P 500 earnings per share (EPS) have topped estimates by 17 % in aggregate, and bounced back above pre-COVID amounts, based on an analysis by Credit Suisse analyst Jonathan Golub.
“Prompt and generous government activity mitigated the [virus-related] injury, leading to outsized economic and earnings surprises,” Golub said. “The earnings recovery has been considerably more robust than we could have thought possible when the pandemic first took hold.”
Stocks have continued to set up fresh record highs against this backdrop, and as fiscal and monetary policy assistance stay strong. But as investors come to be accustomed to firming business functionality, businesses might have to top even bigger expectations in order to be rewarded. This may in turn put some pressure on the broader market in the near-term, as well as warrant much more astute assessments of individual stocks, based on some strategists.
“It is no secret that S&P 500 performance has been really formidable over the past several calendar years, driven mostly via valuation expansion. Nevertheless, with the index P/E [price-to-earnings ratio] recently eclipsing its prior dot com high, we believe that valuation multiples will begin to compress in the coming months,” BMO Capital Markets strategist Brian Belski wrote in a note Thursday. “According to the job of ours, strong EPS growth is going to be necessary for the next leg higher. Fortunately, that is precisely what existing expectations are forecasting. However, we additionally discovered that these types of’ EPS-driven’ periods tend to be tricky from an investment strategy standpoint.”
“We think that the’ easy money days’ are actually over for the time being and investors will have to tighten up their aim by evaluating the merits of individual stocks, rather than chasing the momentum-laden strategies which 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 exactly 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’ will be the most-cited Biden policy on company earnings calls: FactSet
Fourth-quarter earnings season represents the first with President Joe Biden in the White House, bringing a brand new 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 up to this point, based on an analysis from FactSet’s John Butters.
“In terms of government policies discussed in conjunction with the Biden administration, climate change and energy policy (twenty eight), tax policy (20 ) and COVID-19 policy (19) have been cited or reviewed by the highest number of businesses with this point in time in 2021,” Butters wrote. “Of these twenty eight companies, seventeen expressed support (or a willingness to the office with) the Biden administration on policies to greatly reduce carbon as well as greenhouse gas emissions. These 17 companies either discussed initiatives to minimize their own carbon and greenhouse gas emissions or services or merchandise they provide to support customers and customers lower their carbon and greenhouse gas emissions.”
“However, 4 businesses also expressed a number of concerns about the executive order setting up a moratorium on new oil as well as gas leases on federal lands (and offshore),” he added.
The list of twenty eight companies discussing climate change and energy policy encompassed organizations from a broad array of industries, including JPMorgan Chase, United Airlines Holdings and 3M, alongside conventional oil majors like Chevron.
11:36 a.m. ET: Stocks combined, S&P 500 and Nasdaq turn positive
Here’s in which markets were 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 low in February: U. Michigan
U.S. consumer sentiment slid to probably the lowest level since August in February, according to the Faculty of Michigan’s preliminary once a month survey, as Americans’ assessments of the path ahead for the virus-stricken economy unexpectedly grew a lot more grim.
The title consumer sentiment index dipped to 76.2 from 79.0 in January, sharply lacking expectations for a surge to 80.9, according to Bloomberg consensus data.
The complete 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 these households mentioning recent income gains than whenever since 2014,” Richard Curtin chief economist for the university’s Surveys of Consumers, said in a statement.
“Presumably a new round of stimulus payments will reduce fiscal hardships with those with the lowest incomes. Much more surprising was the finding that consumers, despite the likely 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 speed toward posting weekly gains
Here’s in which marketplaces were trading only 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 yield 1.19%
9:05 a.m. ET: Equity funds see highest weekly inflows actually as investors pile into tech stocks: Bank of America
Stock funds simply saw 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 profit throughout the week, the firm added.
Tech stocks in turn saw their very own record week of inflows during $5.4 billion. U.S. large cap stocks saw their second-largest week of inflows ever at $25.1 billion, and U.S. small cap inflows saw the third-largest week of theirs at $5.6 billion.
Bank of America warned that frothiness is actually rising in markets, however, as investors keep on piling into stocks amid low interest rates, along with hopes of a strong recovery for the economy and corporate earnings. The firm’s proprietary “Bull as well as Bear Indicator” tracking 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 had been the main 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 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 is where markets were trading Thursday as over night trading kicked off:
S&P 500 futures (ES=F): 3,904.50, printed 7.5 points or even 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 0.19%