US futures hover near record highs as investors nervously await key US inflation data

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Wall Street awaited US inflation data on Tuesday.

Futures contracts for the major US stock indices were mixed on Tuesday, hovering near record highs as investors awaited key inflation data from the world’s biggest economy.

S&P 500 futures were edged 0.05% higher after the index finished 0.02% lower on Monday, taking it narrowly below Friday’s all-time high. Dow Jones futures rose 0.1% and Nasdaq 100 futures were roughly flat.

Asian stocks moved broadly higher overnight after data showed Chinese imports and exports rebounded in March. Japan’s Nikkei 225 rose 0.72%, but China’s CSI 300 index slipped 0.16% as a spike in yields on the debt of a major asset manager unnerved investors.

In Europe, the continent-wide Stoxx 600 index rose 0.25%. The UK’s FTSE 100 slipped 0.04% despite data showing the country’s GDP rose 0.4% in February.

Meanwhile, bitcoin soared to an all time high of above $62,000 ahead of crypto exchange Coinbase’s IPO, with renewed institutional interest powering the latest leg higher.

The main event on investors’ radar on Tuesday will be US consumer price index inflation data, due at 8.30 a.m. ET.

Predictions of higher growth and inflation have already caused a spike in bond yields, which have in turn weighed on the fast-growing parts of the stock market like technology shares, which look relatively less attractive when yields rise.

Analysts expect Tuesday’s data to show US CPI inflation rose to 2.5% in March from 1.7% in February.

Inflation “has emerged as a key focal point for markets given the debates surrounding inflation and its implications for monetary policy moving forward,” strategist Jim Reid at Deutsche Bank said.

“Indeed, part of the reason that markets have brought forward their expectations for Fed rate hikes is based around rising inflation expectations that they think the Fed might have to rein in.”

Karen Ward, JPMorgan Asset Management’s chief European strategist, has said she thinks inflation could average 3% over the next 10 years, thanks in part to huge amounts of pent-up savings.

However, Goldman Sachs chief economist Jan Hatzius predicted in a note that underlying US inflation would remain “well below the Fed’s 2% target, consistent with an economy that remains well below full employment.”

Bond yields climbed on Tuesday morning, with the yield on the key 10-year US Treasury note rising 1.5 basis points to 1.691%. Yields move inversely to prices.

Investors will also be keeping an eye on 30-year US Treasury auctions, after 3- and 10-year sales attracted solid demand.

Oil prices edged higher, with Brent crude up 0.4% to $63.54 a barrel and WTI crude 0.3% higher to $59.87 a barrel.

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US stocks decline as investors digest volatility from Archegos meltdown

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A trader works on the floor of the New York Stock Exchange (NYSE) in New York, U.S., March 9, 2020.

US stocks ended lower on Tuesday, with the the Dow Jones Industrial Average and S&P 500 retreating from record highs reached the previous day.

New trades linked to Archegos added unease to markets after US data highlighted an economic rebound.

Companies linked to the Archegos Capital Management meltdown last week were struck by a new wave of volatility after Credit Suisse initiated a block trade worth around $2.3 billion in an attempt to limit further losses.

Stocks including ViacomCBS, Discovery, and Tencent all whipsawed, and were down in premarket trading before recovering throughout the day.

The S&P 500 and Dow hit record highs Monday in the wake of a better-than-expected jobs report and record-high expansion in the services sector last month. Optimism around the economic recovery continues to drive markets.

Here’s where US indexes stood after the 4:00 p.m. ET close on Tuesday:

High valuations and other factors have been driving comparisons between current US stock market conditions and those during the dot-com era, but fundamentals are healthier now, said Charles Schwab’s chief investment strategist Liz Ann Sonders. Meanwhile, Nouriel Roubini, an economist known as “Dr. Doom” for his pessimistic market views, said markets are “extremely frothy” and participants are taking “too much risk” in an interview Tuesday.

Gold rose to 0.8% to $1,742.80 per ounce.

West Texas Intermediate crude rise by 1.24%, to $59.37 per barrel. Brent crude, oil’s international benchmark, was down 1% to $62.74 per barrel.

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US tech stock futures rise as bond yields cool after Fed comments, while the Turkish lira plunges

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Jerome Powell stressed that the Fed would maintain support for the economy.

A fall in bond yields triggered a rise in US tech stock futures at the expense of the Dow Jones on Monday, with investors buying back into growth companies after the previous week’s volatility.

Meanwhile the Turkish lira tumbled as much as 15% against the dollar after the country’s president sacked a central bank chief for the third time in under two years.

Futures for the tech-heavy Nasdaq 100 index rose 0.69%, with the dip in bond yields making those more expensive sectors of the stock market more attractive.

Dow Jones futures were off by 1.2% as investors eyed a rotation out of cyclical companies, however, while S&P 500 futures were down 0.44%.

The yield on the key 10-year US Treasury note fell 4.8 basis points to 1.684% after hitting a 14-month high above 1.7% last week.

Bond yields have risen sharply in recent weeks as investors demand higher returns in response to rising growth and inflation expectations.

But the increase has made fast-growing and pricey tech stocks look less attractive, leading to a dynamic in which investors sell Nasdaq companies when yields rise and buy them up again when they fall.

Policymakers from the US Federal Reserve soothed the bond market somewhat over the weekend, as some investors worry the central bank could cut back its support sooner than expected.

Chair Jerome Powell wrote in a Wall Street Journal article: “The recovery is far from complete, so at the Fed we will continue to provide the economy with the support that it needs for as long as it takes.”

Richmond Fed President Thomas Barkin told Bloomberg TV there were no signs yet of undesirable inflation.

Asian stocks were mixed overnight, with China’s CSI 300 rising 1%, but Japan’s Nikkei 225 sliding 2.07%.

Hussein Sayed, chief market strategist at FXTM, said the fallout from the Turkish central bank debacle had knocked Japanese stocks.

“While there should not be a strong link between the Turkish lira and Japanese equity markets, it is believed that retail traders in Japan hold significant leveraged long positions in the lira as a carry trade. Hence, they have to cover these positions by selling equities in local markets,” he said.

The Europe-wide Stoxx 600 index slipped 0.09% in early trading while the UK’s FTSE 100 fell 0.32%.

Turkey’s lira tumbled to close to a record low before recovering somewhat after President Recep Tayyip Erdogan sacked central bank governor Naci Agbal. The currency was down 9.3% on Monday to $0.126.

The firing sparked concerns that Turkey could again cut interest rates, spurring more inflationary pressure.

Lee Hardman, currency analyst at MUFG, said: “Market participants are treating it as a Turkey specific problem so far, although there are clear risks that it could begin to weigh more broadly if the situation continues to escalate in the coming weeks and months.”

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US stocks set to hit new highs while oil soars as US jobless claims beat expectations and economies show signs of recovery

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Oil prices have jumped, with investors expecting a strong rebound in demand as economies recover.

US stocks were on track to rise to all-time highs Friday at the end of a stellar week in which the S&P 500 had already risen about 4% and was heading for its strongest weekly gain in three months.

Signs the US and other economies are recovering from the latest round of coronavirus restrictions have also boosted oil prices to one-year highs, as the demand outlook brightens.

After the index climbed more than 1% on Thursday, S&P 500 futures inched 0.28% higher on Friday. Dow Jones Industrial Average futures rose 0.29%, while Nasdaq futures climbed 0.22%.

China’s CSI 300 rose 0.17% overnight, finishing the week in the green, as the strong economic recovery outweighed worries over rising short-term credit costs. Japan’s Nikkei 225 jumped 1.54% on upbeat earnings and stimulus hopes.

Read more: Investors are flocking to trade Dogecoin and other hot digital tokens on Voyager, a platform with no Robinhood-style restrictions. Its CEO says Bitcoin will hit $100,000 this year – and shares 3 other cryptocurrencies to watch.

The Europe-wide Stoxx 600 index rose 0.42% in early trading, while the UK’s FTSE 100 climbed 0.11%.

Investors have been pulled in different directions in recent weeks. Hopes that vaccines and stimulus will power a strong recovery in 2021 have clashed with short-term economic pain and a day-trading frenzy that shook markets at the end of January.

But better-than-expected economic data from the US has sparked new optimism that the recovery will be a powerful one.

Figures released Thursday showed that new US unemployment claims fell last week for the third week in a row – to 779,000 – and factory orders rose more than expected in December.

The Bank of England on Thursday cut its short-term growth forecasts because of January’s lockdown. But it said the country’s speedy coronavirus vaccine rollout “should help the UK economy recover rapidly later this year.”

Adding to the general mood of optimism, Democrats in Congress are powering ahead with plans to pass a $1.9 trillion stimulus package without Republican approval.

Investors’ attention Friday will be on the official monthly US employment report, due at 8:30 a.m. ET. Economists at Daiwa expect a modest 50,000 increase in payrolls, following a 140,000 decline in December. Yet they said in a note that recent data suggested the figure could be better than expected.

Oil prices have soared this week as the economic outlook has brightened, with investors betting demand will rise. Brent crude was up 1.12% on Friday morning to $59.66 a barrel, its highest level since last February. Brent has gained more than 7% this week, its largest weekly increase in a month. West Texas Intermediate crude was 1.42% higher at $57.03 a barrel.

Read more: A top-ranked manager at a firm that handles $50 billion in wealth told us 4 ways investors could smartly play day-trading favorites like GameStop without risking it all

“With inflation sentiment rising in the US, partially due to higher government borrowing, adding a tailwind to the economic recovery, the conditions still remain supportive for oil markets,” said Jeffrey Halley, a senior market analyst at the currency firm Oanda.

The dollar index slipped back from its highest level since December. It was last down 0.16% to 91.39.

A strong pound, after the Bank of England suggested negative interest rates were not likely anytime soon, added to greenback weakness. The pound was up 0.21% to $1.37 on Friday after jumping Thursday.

US bond yields were little changed. The yield on the 10-year Treasury note was roughly flat at 1.139% but continued to trade near its highest level since March, reflecting stronger growth and inflation expectations. Yields move inversely to bond prices.

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US stocks close at record highs after Joe Biden becomes 46th President of the United States

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Joe Biden (L), flanked by incoming US First Lady Jill Biden is sworn in as the 46th US President by Supreme Court Chief Justice John Roberts on January 20, 2021


US stocks closed at record highs on Wednesday following the inauguration of Joe Biden as the 46th President of the United States.

The stock market was led higher by technology stocks following a stronger than expected earnings report from Netflix that sent shares soaring nearly 20%. 

The video-streaming company said it expected positive free-cash-flow generation going forward and would begin to stop relying on the debt markets to fuel its content lineup; it could eventually explore a stock-buyback program.

Here’s where US indexes stood at the 4:00 p.m. ET close on Wednesday:

Read more: The head of active equity at Wells Fargo’s $607 billion asset-management arm shares how she worked her way up from the call center 29 years ago – and pinpoints 3 trends transforming the investment landscape today

The enthusiasm for tech shares on Wednesday also helped fuel a 6% surge in Alphabet to record all-time-highs.

Morgan Stanley reported fourth-quarter earnings that beat analysts’ expectations, driven by the firm’s trading unit and wealth-management arm.

Popular cryptocurrencies like Bitcoin and Ethereum pulled back on Wednesday after Janet Yellen, President-Joe Biden’s nominee for treasury secretary, said it might make sense to “curtail” their use because they are mainly used for illicit activities in a transactional sense.

Alibaba surged 7% after its founder, Jack Ma, resurfaced in a videoconference. Ma had not been seen in public for months as Chinese regulators clamped down on the Ant Group initial public offering and Alibaba’s selling practices.

Famed short-seller Jim Chanos said he transitioned his short exposure in Tesla to put options from shares, which will limit his downside potential. 

Oil prices were mixed. West Texas Intermediate crude jumped 0.12%, to $53.10 per barrel. Brent crude, oil’s international benchmark, declined 0.05%, to $55.87 per barrel.

Gold rose as much as 1.57%, to $1,869.10 per ounce.

Read more: GOLDMAN SACHS: Buy these 25 stocks best positioned to juice profits in 2021 as stimulus and vaccine progress spur economic growth

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Stocks are in a ‘rational bubble’ as long as investors remain confident in continued Fed support, economist Mohamed El-Erian says

Mohamed El-Erian
  • Mohamed El-Erian told CNBC stocks are in a “rational bubble” and asset prices will continue to rise as long as the Federal Reserve signals to investors that it will continue to support the markets. 
  • “It’s rational because the Fed and the ECB keep on signaling that they will continue to inject massive liquidity, and as long as the market is confident that that’s the case, it will drive prices higher,” the Allianz chief economic adviser said. 
  • El-Erian said that the US will continue to see a contrast between what the market is doing and what the broader economy is indicating because of the liquidity in the market.
  • Visit Business Insider’s homepage for more stories.

Mohamed El-Erian told CNBC on Wednesday stocks are in a “rational bubble” at the moment and asset prices will continue to rise as long as the Federal Reserve signals to investors that it will continue to provide support for the markets.

“This is not an irrational bubble. This is a rational bubble,” the Allianz chief economic adviser said. “It’s rational because the Fed and the ECB keep on signaling that they will continue to inject massive liquidity, and as long as the market is confident that that’s the case, it will drive prices higher.”

Typically, a stock market bubble is created when asset prices surge to levels that greatly exceed the their intrinsic value. Legendary investor Jeremy Grantham said on Tuesday that the stock market is in a  “fully-fledged epic bubble,” driven by extreme overvaluations, explosive price increases, frenzied issuance, and “hysterically speculative investor behavior.” 

For El-Erian, there is a rational reason why stock prices keep going up, and it’s investor confidence in support from the Federal Reserve.

Read more:Deutsche Bank says buy these 14 beaten-down financial stocks poised for a bullish recovery from 2020’s ‘savage sell-off’ – including one that could rally 30%

Stock prices ballooned in 2020: the S&P 500 gaining 16%, while the tech-heavy Nasdaq soared 43%. El-Erian said there’s so much liquidity “sloshing around the system,” that stock prices will continue to move higher this year.

The result is that stock prices continue to rise despite political and economic turmoil outside of Wall Street.  On Wednesday as protesters stormed the US Capitol building, the stock market remained unbothered. The Dow Jones closed at a record high, while the S&P 500 closed up 0.5%. 

El-Erian said that the US will continue to see a contrast between what the market is doing and what “conditions on the ground” are saying because of the liquidity in the market.

Also on Wednesday, the ADP monthly employment report revealed that the US lost 123,000 private payrolls in December. The reading marks the first contraction in nationwide hiring since April. El-Erian said that the report was a “big miss” and demonstrates the “power of liquidity.” 

 

 

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US stocks flat as rollercoaster 2020 comes to a close

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Waterford crystals were installed to the Times Square ball for New Years Eve Celebration in New York City, on December 27, 2020

  • US stocks opened mostly flat on Thursday morning to finish off a rollercoaster year for markets. 
  • Initial jobless claims declined by 19,000 to 787,000, beating the consensus estimate of 828,800.
  • Watch major indexes update live here.

US stocks opened relatively flat on Thursday morning to finish off a rollercoaster year for markets. 

The number of Americans filing for unemployment benefits for the first time dropped unexpectedly last week- the second straight week of declines. Initial jobless claims declined by 19,000 to 787,000. The consensus estimate was for jobless claims to rise to 828,800.

Meanwhile, continuing claims decreased to 5.22 million in the week that ended Dec.19. That’s 150,000 less than the 5.37 million claims economists projected.

Here’s where US indexes stood shortly after the 9:30 a.m. ET open on Thursday:

Read more:We spoke with Wall Street’s 9 best-performing fund managers of 2020 to learn how they crushed the chaotic market – and compile the biggest bets they’re making for 2021

Several cryptocurrency exchanges including Crypto.com, Coinbase, and OkCoin said this week they were suspending trading of the XRP token following the SEC’s complaint against Ripple Labs, XRP’s developer. 

“XRP (the coin) is one foot in the grave,” Phil Liu, Chief Legal Officer at Arca, told Business Insider on Wednesday. “Ripple, the company, may be insolvent by the end of 2021 if it can’t raise money by selling XRP and its other products aren’t profitable.”

Oil prices were lower. West Texas Intermediate crude declined as much as 0.68%%, to $48.07 per barrel. Brent crude, oil’s international benchmark, was down 0.72% to $51.26 per barrel.

Gold was up 0.43%, to $1,901.60 per ounce.

Read more:Market wizard Jeff Neumann started trading with $2,500 and grew it to $50 million. He shares 6 timeless rules that helped him reach millionaire status in his first year.

 

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US stocks jump after President Trump signs $900 billion stimulus bill

Stimulus Bill
  • US stocks edged higher on Monday after President Donald Trump signed a $900 billion stimulus bill after previously leaving it up in the air as he advocated for $2,000 stimulus checks.
  • The bill Trump signed will include $600 stimulus checks, though Trump and Democrats continue to advocate for an increase to $2,000.
  • The House of Representatives will vote on a measure on Monday to increase the size of the checks to $2,000, though Senate Majority Leader Mitch McConnell has not shown willingness to support bigger checks.
  • Watch major indexes update live here.

US stocks gained on Monday after President Donald Trump signed a $900 billion stimulus bill that includes $600 stimulus checks and an extension of the Paycheck Protection Program and unemployment benefits.

After the stimulus bill was passed by Congress, Trump signaled he may not sign the bill as he complained about “pork spending” and advocated for an increase in stimulus checks to $2,000 from $600.

The signing of the bill prevented a government shutdown that would have occurred at midnight tonight. Democrats and Trump continue to advocate for an increase in stimulus checks to $2,000. 

Senate Minority Leader Chuck Schumer tweeted on Sunday, “The House will pass a bill to give Americans $2,000 checks. Then I will move to pass it in the Senate. No Democrats will object. Will Senate Republicans?”

Senate Majority Leader Mitch McConnell has shown no signs of supporting $2,000 stimulus checks.

Here’s where US indexes stood shortly after the 9:30 a.m. ET open on Monday:

Read more: ‘It could be a Roaring 20s that will end badly’: An equities chief who oversees over $7 billion shares his investing playbook and major predictions for 2021 and beyond

AstraZeneca is on the verge of receiving emergency use authorization from the UK for its COVID-19 vaccine, according to The Telegraph. The rollout and administration of its vaccine could begin in the country in the first week of 2021.

AstraZeneca’s CEO said its vaccine candidate could reach 95% efficacy, on par with vaccines from Pfizer and Moderna, in an interview with the Sunday Times. Shares of AstraZeneca jumped as much as 6% in Monday trades.

Oil prices edged lower. West Texas Intermediate crude fell as much as 0.19%, to $48.14 per barrel. Brent crude, oil’s international benchmark, fell 0.02%, to $51.28 per barrel, at intraday lows.

Gold rose as much as 0.52%, to $1,893.00 per ounce.

Read more: A hedge fund chief who oversees $2 billion breaks down why we’re in for a 61% stock-market crash over the next 18-24 months – and shares 3 types of companies he’s shorting right now

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US stocks edge higher as political wrangling over stimulus bill continues

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Printer and internet snafus held up the release of Congress’ latest stimulus bill text at the US Capitol on Monday.

  • US stocks edged higher in a shortened trading session as political wrangling over a $900 billion stimulus bill continued after President Trump requested $2,000 stimulus checks to be included.
  • With Trump out of town after flying to Mar-a-Lago on Wednesday, House Speaker Nancy Pelosi attempted to pass an amendment to the bill to include bigger stimulus checks with unanimous consent.
  • That attempt has failed, and now the House of Representatives is adjourned until Monday at 2:00PM, leaving it up to Trump to either sign the bill or not.
  • Watch major indexes update live here.

US stocks moved higher in a shortened trading session on Christmas Eve as political wrangling over a $900 billion stimulus bill continued into Thursday after President Trump requested $2,000 stimulus checks to be included.

Pelosi attempted to add an amendment to the bill increasing the size stimulus checks to $2,000 from $600 via unanimous consent, but that initiative failed Thursday morning.

Now, the House of Representatives has adjourned until Monday at 2:00 P.M., leaving it up to President Trump to sign the original stimulus bill that passed the House and Senate earlier this week.

Here’s where US indexes stood shortly after the 9:30 a.m. ET open on Thursday:

Read more: ‘It could be a Roaring 20s that will end badly’: An equities chief who oversees over $7 billion shares his investing playbook and major predictions for 2021 and beyond

Alibaba slid as much as 7% after the Chinese government opened an anti-trust investigation into the e-commerce giant.

Altimmune fell 10% after the FDA put a clinical hold on its intranasal COVID-19 vaccine candidate.

The stock market will close at 1:00 P.M. today.

Oil prices edged lower. West Texas Intermediate crude fell as much as 0.64%, to $47.81 per barrel. Brent crude, oil’s international benchmark, fell 0.59%, to $50.90 per barrel.

Gold traded lower, down as much as 0.23%, to $1,873.70 per ounce.

Read more: A hedge fund chief who oversees $2 billion breaks down why we’re in for a 61% stock-market crash over the next 18-24 months – and shares 3 types of companies he’s shorting right now

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Dow drops 200 points as new UK virus strain outweighs $900 billion stimulus deal

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  • US stocks fell sharply on Monday as a new COVID-19 strain identified in the UK weighed on investor sentiment.
  • The mutated virus strain is said to be more contagious and has led to new lockdown measures and travel restrictions in the UK just ahead of Christmas.
  • A new $900 billion stimulus deal from Congress that includes $600 direct checks wasn’t enough to counter investor concerns about the mutated virus.
  • Watch major indexes update live here.

US stocks declined on Monday as investors grappled with a new COVID-19 strain identified in the UK that’s said to be more contagious.

Renewed virus concerns outweighed the $900 billion stimulus deal from Congress that includes $600 stimulus checks and expanded unemployment benefits.

Much is still unknown about the mutated virus, including how well vaccines from Pfizer and Moderna can protect against it.

Surging COVID-19 cases and concerns about the new variant of the virus have led to lockdown measures and travel restrictions for the UK. France, Germany, Italy, Ireland, and the Netherlands have banned flights from the UK, and Austria and Sweden are preparing to do the same.

Here’s where US indexes stood shortly after the 9:30 a.m. ET open on Monday:

Read more: BANK OF AMERICA: Buy these 26 cheap and fundamentally rock-solid stocks before the economic rebound sends them soaring in 2021

Travel stocks plummeted on Monday as investors grappled with the renewed risk of a longer shutdown and travel restrictions. Airline stocks fell as much as 9%, while cruise-line stocks dropped as much as 12%.

Oil prices edged lower. West Texas Intermediate crude dropped as much as 6%, to $46.18 per barrel. Brent crude, oil’s international benchmark, declined 5.9%, to $49.20 per barrel, at intraday lows.

Gold rose as much as 1.4%, to $1,906.82 per ounce.

Read more: A hedge fund chief who oversees $2 billion breaks down why we’re in for a 61% stock-market crash over the next 18-24 months – and shares 3 types of companies he’s shorting right now

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