Friday, December 9, 2022

S&P 500, Dow set for muted open on concerns over fading stimulus By Reuters


© Reuters. The New York Stock Exchange is pictured

By Shivani Kumaresan and Medha Singh

(Reuters) – The and the Dow were set to open slightly lower on Friday as fears grew over fading stimulus and the blow to the economy from increasing coronavirus infections.

The tech-heavy Nasdaq was on track for a slightly higher open as investors returned to stocks that have shown resilience during the pandemic. Netflix Inc (NASDAQ:), Inc (NASDAQ:) and Microsoft Corp (NASDAQ:) edged higher premarket.

In a surprise move on Thursday, U.S. Treasury Secretary Steven Mnuchin said key COVID-19 pandemic lending programs at the Federal Reserve to support businesses and local governments would expire by the end of the year.

The decision to end the program, which was deemed essential by the central bank, comes as data showed a rise in jobless claims last week as new business restrictions to control spiraling COVID-19 infections likely unleashed a fresh wave of layoffs.

California and Ohio imposed nightly curfews on Thursday, joining 20 U.S. states to have adopted new mandates to fight the spread of the virus this month.

“I don’t think we will go through a full-blown contraction or a complete shutdown, but as the vaccine starts to roll out there is potential for tremendous economic improvement next year,” said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida.

U.S. Senate Democratic leader Chuck Schumer and Republican Majority Leader Mitch McConnell decided to resume COVID-19 relief talks on Thursday.

The S&P 500 and the Dow were little changed over this week following two strong weeks of gains, as investors juggled between growing optimism over an effective coronavirus vaccine and near-term economic damage from the surging virus infections.

Major banks have upgraded their stock market forecasts for 2021 after recent promising data from COVID-19 vaccine trials.

At 08:21 a.m. ET, Dow E-minis were down 0.16% and S&P 500 E-minis were down 0.08%. E-minis were up 0.1%.

Pfizer Inc (NYSE:) rose 1.8% as the company said it has applied to U.S. health regulators for emergency use authorization of its COVID-19 vaccine.

Foot Locker (NYSE:) Inc jumped 5.7% after the shoes and apparel retailer saw an increase in its quarterly same-store sales, while apparel and home fashion retailer Ross Stores Inc (NASDAQ:) gained 3.4% after its quarterly sales topped expectations.

Gilead Sciences Inc (NASDAQ:) fell 1.5% as a World Health Organization panel advised against the use of remdesivir for patients hospitalized with COVID-19 as there is no evidence the drug improves survival or reduces the need for ventilation.

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