The movement in futures follows a good week for the stock market. The Dow Jones jumped 3.3% to post its biggest gain in a week since August, while the S&P 500 and Nasdaq Composite gained 3.8% and 4.6% respectively for their best weeks since July.
“Last week, markets appeared to assess the perceived clarity of the election, and with it, an increasing likelihood of further fiscal stimulus – at least in the pipeline. This was reflected in the outperformance of small caps on higher yields on Treasuries, ”Julian Emanuel, BTIG’s chief equities and derivatives strategist, said in a note to clients on Sunday.
However, the chances of another round of pre-election stimulus appeared to diminish over the weekend, as House Speaker Nancy Pelosi, D-Calif., And Senate Republicans rejected an offer of 1. , $ 8 trillion from the White House.
In a letter to her colleagues, Pelosi highlighted what she said were insufficient offers on health issues.
“The news is full of numbers in dollar terms. The heart of the matter is: can we let the virus rage and ignore the science as the administration is proposing, or will they accept the scientific strategic plan in the Heroes Act to crush the virus, ”Pelosi said. referring to a bill that Democrats have already passed in the House.
Meanwhile, Treasury Secretary Steven Mnuchin and White House Chief of Staff Mark Meadows on Sunday called for a separate vote on the paycheck protection program in their own letter to Congress.
The apparent deadlocks follow a swirling week in Washington in which President Donald Trump at one point called off negotiations, saying Congressional Republicans should focus on confirming Amy Coney Barrett to the vacant seat at the Supreme Court. Trump then reversed his position and said “go big” in the negotiations.
Monday’s session could also see investors and traders adjust their positions before the third quarter earnings season shifts into high gear later in the week. Several major banks and airlines are expected to release their results on Tuesday, including JPMorgan Chase and Delta Air Lines.
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