Stocks Rise Ahead of Biden's Stimulus Speech
By Anna Hirtenstein
U.S. stocks climbed Thursday as investors awaited details of the
incoming Biden administration's plans for a fresh coronavirus
The Dow Jones Industrial Average rose 0.3% shortly after the
opening bell. The S&P 500 and Nasdaq Composite also advanced
Jobless claims data Thursday showed that 965,000 people applied
for unemployment insurance in the week ended Jan. 9, a sizable
increase compared with the previous week and higher than economists
had expected, as the surge in Covid-19 cases and fresh business
restrictions weighed on the labor market.
Meantime, all eyes are on a speech expected Thursday from
President-elect Joe Biden that is set to detail the scale of his
proposed spending package to support households and businesses
through the pandemic.
Additional stimulus would be favorable for equity markets and
reinforce expectations for economic growth, said Luc Filip, head of
private banking investments at SYZ Private Banking.
"How it will be implemented down to the real economy, down to
small companies, that will be key," he said.
Stock markets have been largely muted this week, despite the
political turmoil engulfing Washington. President Trump was
impeached Wednesday for inciting the Jan. 6 riot at the Capitol,
becoming the only president to have been impeached twice. With Mr.
Trump leaving office in less than a week, markets largely viewed
the move as symbolic rather than practical.
BlackRock shares rose 1.1% in premarket trading after the
world's largest money-management company said fourth-quarter profit
rose 19%, exceeding analysts' estimates. Delta Air Lines rose 2.6%
after it said it ended 2020 at a loss but expected to have access
to up to $19 billion of liquidity in the first quarter.
Thursday will also see Poshmark, an online marketplace for
secondhand goods, begin trading.
Ahead of the opening bell, Tesla shares slipped 1.3% after
regulators asked the car maker to recall about 158,000 vehicles
over safety concerns. Johnson & Johnson rose 1.4% after it said
its experimental Covid-19 shot generated an immune responses from a
single dose, rather than two.
Overseas, the pan-continental Stoxx Europe 600 gained 0.4%.
Italian 10-year government-bond yields rose to 0.649% from 0.587%
Wednesday after former Premier Matteo Renzi said his party was
leaving the ruling coalition. This move could trigger an election,
as it removes the prime minister's majority in parliament.
Italy is often seen as the weakest link among major economies in
the eurozone, and political drama has previously sparked sharp
selloffs in the country's government debt. "This is political
noise, but still something that creates uncertainties," said Mr.
Among major European shares, Fiat Chrysler led decliners,
falling 8.9% ahead of the distribution of a special dividend.
Carrefour fell 5.1% after France said it might block Canadian
Alimentation Couche-Tard's nearly $20 billion bid for the French
supermarket chain. Peugeot rose close to 4% after a report
suggested sales recovered in the second half of 2020, although they
were still down for the full year.
In Asia, the Shanghai Composite Index slipped 0.9% after data
showed that China's export growth in December declined from
November. Most other major benchmarks rose, with Hong Kong's Hang
Seng Index and Japan's Nikkei 225 both up 0.9%.
China's biggest tech companies rose after The Wall Street
Journal reported that the U.S. is expected to let Americans
continue to invest in them, after weighing a ban. Alibaba Group
gained 5% and Tencent Holdings climbed 5.6%.
Federal Reserve Chairman Jerome Powell is scheduled to speak on
Thursday at 12:30 p.m. ET at a virtual event hosted by Princeton
University's Bendheim Center for Finance.
Esty Dwek, head of global market strategy at Natixis Investment
Managers, said she would be watching closely for any mention of
what the central bank might do about the recent rise in Treasury
The yield on the benchmark 10-year Treasury note rose to 1.098%
from 1.089% Wednesday. It has traded above 1% since the first week
of January, after spending most of 2020 below the threshold.
Write to Anna Hirtenstein at email@example.com
(END) Dow Jones Newswires
January 14, 2021 09:48 ET (14:48 GMT)
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