Inventory futures rise even after Trump slams Covid stimulus invoice
U.S. stock futures edged higher early Wednesday, largely recovering from earlier declines after President Donald Trump expressed concerns about the new Covid-19 relief package which could delay the deployment of funds to struggling Americans.
Dow Jones Industrial Average futures rose 78 points, or 0.3%. The implied an opening gain of about 80 points. S&P 500 futures rose 0.3% and Nasdaq 100 futures gained 0.2%.
Late on Tuesday, Trump called the new $900 billion Covid relief bill an unsuitable “disgrace” and admonished lawmakers to alter the bill’s contents, especially the amount allocated for direct payments to Americans. Trump did not threaten to veto the legislation but he asked to be sent a “suitable bill or else the next administration will have to deliver a Covid relief package.”
“President Trump’s demand for revisions to the COVID relief bill to raise the individual payment amount to $2,000 significantly raises uncertainty for the days ahead, but our base case remains that the bill passed by Congress will become law,” wrote Ed Mills of Raymond James overnight. “The bill becomes law on Jan. 3 without any action taken by the President – although a government shutdown occurs if the bill is not signed by Dec. 28.”
On Tuesday, the Dow Jones Industrial Average shed 200 points and the S&P 500 slipped 0.2% for its third day of losses. Travel-related stocks came under pressure amid lingering concerns about the new coronavirus strain from the U.K.
Apple bucked the sell-off on Tuesday rising 2.9%, the shares were slightly higher in premarket again on Wednesday. The Nasdaq Composite was the outperformer on Tuesday, closing up 0.5% at a new record as Amazon, Apple and Microsoft all closed higher. Stationary bike company Peloton popped 11%.
The small-cap benchmark Russell 2000 rose 0.99% to a close at a record. Small caps are up 105.94%, more than doubling off their March lows.
Congress passed the rescue bill this week with $900 billion in pandemic aid after months-long negations. The package includes additional jobless benefits, more small business loans, direct payments of $600 and funds to distribute Covid-19 vaccines, among other provisions.
Despite the newly passed fiscal support, millions of Americas are still struggling to find work as the pandemic roiled the labor force.
Last week’s jobless claims numbers come out on Wednesday at 8:30 a.m. ET. Economists polled by Dow Jones are expected 888,000 Americans filed for unemployment last week, more than the previous week’s 885,000.
The U.S. is reporting at least 215,400 new Covid-19 cases and at least 2,600 virus-related deaths each day, based on a seven-day average calculated by CNBC using Johns Hopkins University data.
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