Stocks wobbled between small gains and losses in afternoon trading on Tuesday (US time), after the major stock market indexes hit record highs the day before. Investors continue to keep their eyes on Washington, where it appears Democrats plan to move ahead without Republican help on a major stimulus bill for the economy.
In early afternoon trade, the S&P 500 index was flat, the Dow Jones Industrial Average has inched 0.1 per cent higher and the Nasdaq has added 0.3 per cent. A slight pullback after six straight days of gains is not uncommon, as investors pause during a rally to reassess and wait for more economic data to see where the market goes next.
Despite the soft lead, the Australian sharemarket is set for gains, with futures at 4.51am AEDT pointing to a rise of 17 points, or 0.3 per cent, at the open.
The S&P 500 was nearly evenly split between gainers and losers, with communications companies rising the most. A mix of companies that deal with consumer services and products were the biggest drag on the broader market.
Several companies were making big moves after reporting their latest quarterly results. Hanesbrands soared almost 24 per cent after reporting earnings that came in well ahead of what analysts were expecting.
Stocks have been moving steadily higher for several days as Wall Street becomes more optimistic that the worst parts of the economic impact of the coronavirus pandemic might be in the rearview mirror. Vaccine rollouts continue both in the US and globally, with the US administrating hundreds of thousands of doses per day at this point.
Washington is preparing to go big for its next round of economic stimulus to support struggling Americans and businesses. Democrats have rallied around President Joe Biden’s $US1.9 trillion ($2.5 trillion) stimulus plan, which will include one-time payments to Americans plus a likely increase in the federal minimum wage to $US15 an hour.
“Market participants doubled down on fiscal stimulus bets” after Federal Reserve officials downplayed concerns the spending might fuel inflation, said Mizuho Bank in a report.
Shares of GameStop and AMC Entertainment continue to be volatile, as online investors remain in a tug-of-war with Wall Street institutional investors over the struggling companies’ values. GameStop shares were down 18.2 per cent and AMC was down 12.5 per cent.
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Source: Thanks smh.com