Futures contracts linked to the Dow Jones Industrial Average fell 29 points. S&P 500 futures fell 0.06%, while Nasdaq 100 futures slipped 0.07%.
The major averages were coming out of a record session, which saw all three indices close at new highs. During regular trading hours, the Dow advanced 148 points for a gain of 0.49%. The S&P 500 and the Nasdaq Composite hit record high intraday and close, gaining 0.58% and 0.84% respectively.
The higher leg came amid optimism around Covid vaccines, as well as hope that Washington will soon reach consensus on further stimulus measures.
Capitol Hill executives have said they are close to a deal that would provide $ 900 billion in additional aid. The talks, which have spanned months, collide with the wire, with federal funding expiring at 12:01 a.m. ET on Saturday.
Senate Majority Leader Mitch McConnell, R-Ky., Said Thursday that a “bipartisan, bicameral deal appears to be near.” He noted that it was “highly likely” that Congress will work over the weekend, and said lawmakers may have to adopt a short-term funding measure to buy enough time to approve the legislation.
House Speaker Nancy Pelosi, D-Calif., Also said Democrats are moving closer to consensus. “We have made progress this morning” and “are awaiting a response,” she told reporters on Thursday.
The upward jump in stocks on Thursday came despite an increase in Covid cases, as well as disappointing economic data. Unemployment claims totaled 885,000 last week, hitting their highest level since early September and surpassing the expected figure of 808,000. Meanwhile, data released on Wednesday showed retail sales fell 1.1% in November, more than the 0.3% drop expected by economists.
“The bad news this week is that the third wave continues to worsen and the economic damage from the pandemic continues to increase,” said Brad McMillan, chief investment officer at Commonwealth Financial Network. “The good news is that the policy is starting to successfully contain the virus, and the federal government will likely pass a stimulus bill, mitigating the two main risk factors. ”
McMillan said investors should expect more near-term volatility amid developments on the stimulus and vaccine front, before the economy returns to growth in 2021. “With vaccines now available and increasing, we are at the end of the start of the pandemic, and the markets are recognizing it, ”he added.
On Thursday evening, Food and Drug Administration advisers overwhelmingly supported Moderna’s Covid vaccine, a key step towards FDA approval for public distribution.
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