Friday March 26th

26-03-2021

Dow futures rise 150 points as economic recovery plays climb again

U.S. stock index futures moved modestly higher early Friday as Wall Street looked to end the volatile week on a high note. Futures contracts tied to the Dow Jones Industrial Average implied an opening gain of about 150 points. Futures for the S&P 500 rose 0.3%. Nasdaq 100 futures traded flat. Classic reopening plays rose again in premarket trading, building on the momentum from the previous session. United Airlines jumped 2% in early trading, while Carnival and Carnival climbed more than 2.5% each. Futures were also boosted by bank stocks, which rose after the Fed announced that banks could resume buybacks and raise dividends starting at the end of June. The central bank originally said it would lift pandemic era restrictions in the first quarter, but even the delayed move gives investors more clarity. “The banking system continues to be a source of strength and returning to our normal framework after this year’s stress test will preserve that strength,” Vice Chair for Supervision Randal Quarles said in a statement. Shares of JPMorgan and Goldman Sachs gained 1% each, while Bank of America also jumped 1.5% in premarket trading. Investors also cheered data showing subdued inflation. The core personal consumption expenditure price index, which strips out volatile food and energy prices, rose 0.1% month over month, matching expectations from economists polled by Dow Jones. Year over year, the gauge climbed 1.4%, slightly lower than a 1.5% estimate. The move in futures comes after stocks bounced in afternoon trading on Thursday, with the Dow swinging more than 500 points as cyclical trades gained steam. The strong close broke a recent trend of poor finishes on Wall Street and trimmed the market’s week-to-date losses. The Dow and S&P 500 are now down less than 0.1% for the week, while the Nasdaq Composite is in the red by 1.8%. “If you’re positioned the way we are, which is for a cyclical recovery and being overweight the value sectors, certainly you can’t run a victory lap here. But it is nice to see, after the last six days, that some of the trends that have been in place for the better part of six months seem to be reasserting themselves,” Jason Trennert, CEO of Strategas Research Partners, said on CNBC’s “Closing Bell.” Stocks in Asia-Pacific rose on Friday, with shares in mainland China and Japan among the biggest gainers regionally. By the Friday market close on the mainland, the Shanghai composite rose 1.63% to 3,418.33 while the Shenzhen component jumped 2.597% to 13,769.68. Hong Kong’s Hang Seng index gained 1.57% on the day to 28,336.43. In Japan, the Nikkei 225 closed 1.56% higher at 29,176.70 while the Topix index rose 1.46% to finish its trading day at 1,984.16. South Korea’s Kospi advanced 1.09% to close at 3,041.01. Oil prices bounced back on Friday from a plunge a day earlier on concerns that a large container ship that ran aground in the Suez Canal may block the vital shipping lane for weeks, squeezing supply. Prices, however, were still headed for a third consecutive weekly loss. Brent crude advanced $1.16, or 1.9%, to trade at $63.12 per barrel, after dropping 3.8% on Thursday. U.S. West Texas Intermediate (WTI) crude advanced $1.25, or 2.1%, to trade at $59.81 per barrel, having tumbled 4.3% a day earlier. Both benchmarks were on track for a weekly loss of more than 3%, following a more than 6% decline last week. Gold edged higher on Friday as concerns over surging coronavirus cases in Europe and a pullback in the dollar offset pressure from rising U.S. Treasury yields, although bullion was still on track for its first weekly decline in three. Spot gold was up 0.1% at $1,728.08 per ounce. Bullion is down nearly 1% so far this week. U.S. gold futures were up 0.2% at $1,727.90 per ounce.