Stock Futures Tick Up Ahead of Economic Data
April 23 2021 - 5:37AM
Dow Jones News
By Anna Hirtenstein
U.S. stock futures edged up on Friday as investors assessed
fresh data on how the manufacturing and services sectors world-wide
are faring in the second quarter.
Futures tied to the S&P 500 ticked 0.2% higher, suggesting
the broad-market index may regain some ground. The gauge dropped
0.9% Thursday on reports that President Biden is considering higher
capital-gains taxes for the wealthiest Americans, and is on track
to end a four-week streak of gains.
Nasdaq-100 futures edged up 0.2%, pointing to muted gains in
technology stocks after the opening bell.
Stocks have been choppy this week as sentiment wavered between
concerns about fresh waves of Covid-19 infections around the world
and optimism prompted by promising economic data. Weekly jobless
claims last week hit the lowest point since the pandemic began,
indicating that the U.S. labor market is improving. Money managers
are looking to companies' projections and other key indicators to
gauge whether the economic recovery will stay on track and justify
high valuations for stocks.
"Data is taking on more meaning," said Georgina Taylor,
multiasset fund manager at Invesco. "We've had all the hope built
into expectations, but ultimately, we still need earnings to
continue recovering, at the same time as we need reassurance that
economic data is reflecting those stronger expectations."
Investors are awaiting the preliminary results from surveys in
April of U.S. purchasing managers in the manufacturing and services
industries, which will be out at 9:45 a.m. ET. In the eurozone,
similar surveys showed that manufacturing and services expanded
this month.
"Expectations are very high for the U.S., we're entering a very
strong quarter," said Esty Dwek, head of global market strategy at
Natixis Investment Solutions. "The reopening is accelerated,
vaccinations have accelerated a lot through March and April. So
they will be a confirmation of these very strong trends in the
U.S."
Earnings season remains under way, with Honeywell International
and American Express slated to report on Friday before markets
open.
In bond markets, the yield on the 10-year Treasury note ticked
up to 1.560%, from 1.554% on Thursday.
Overseas, the pan-continental Stoxx Europe 600 pulled back 0.2%,
weighed down by the reports on Thursday about Mr. Biden's tax
plans.
The Shanghai Composite Index rose 0.3% by the close of trading,
and Hong Kong's Hang Seng Index added 1.1%. Japan's Nikkei 225
ticked down 0.6%.
India's benchmark stock index declined 0.3% and is down 1.8% for
the week. The country reported the world's biggest daily jump in
Covid-19 cases on Thursday.
Bitcoin fell over 10% and traded below $50,000, according to
data from CoinDesk. The cryptocurrency has been dropping since last
weekend. It had risen above $63,000 and hit a record last week.
"Bitcoin is not immune to reduction in global risk appetite.
Biden's latest tax proposal that shook the equity market on
Thursday, this put a strain on investor sentiment," said Joel
Kruger, a strategist at LMAX Group, a currencies and cryptocurrency
exchange. "Short term, because it is an emerging asset that is
still trying to find its legs, it is exposed to risk-off
events."
Write to Anna Hirtenstein at anna.hirtenstein@wsj.com
(END) Dow Jones Newswires
April 23, 2021 05:22 ET (09:22 GMT)
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