Stock indexes look set to rise, Dow flat after Congress passes COVID aid package

U.S. stock-index futures indicated a mostly higher start to trade on Tuesday, after a volatile session Monday, as worries about a new strain of COVID-19 in the U.K. subsided and as Washington lawmakers hurried through a $900 billion coronavirus aid package for households and businesses, culminating months of tense negotiations.

How are equity benchmarks performing?

  • Futures for the Dow Jones Industrial Average YM00, -0.05% were off 3 points, or less than 0.1%, at 30,110.
  • S&P 500 index futures ES00, 0.12% were up 7.70 points to reach 3,693.50, a gain of 0.2%.
  • Nasdaq-100 futures NQ00, 0.40% rose 62.25 points at 12,747.50, a climb of 0.5%.

On Monday, markets finished mostly lower but not before a major comeback:

  • The Dow DJIA, -0.26% closed 37.40 point, or 0.1%, higher at 30,216.45, after touching an intraday low of 29,755.53.
  • The S&P 500 index SPX, -0.14% slid 14.49 points, or 0.4%, to end at 3,694.92.
  • The Nasdaq Composite Index COMP, 0.19% closed 13.12 points, or 0.1%, lower at 12,742.52.

What’s driving the market?

What a difference a day makes.

President Trump is expected to sign another coronavirus aid package into law after the Senate and House voted late Monday to approve a $900 bln plan and a $1.4 trillion spending bill that will fund the government through September 2021. The Senate passed the fiscal spending bill 92-6 while the House approved it in a 359-53 vote late Monday.

The passage of the relief package, seen as crucial to sustaining any rally on Wall Street, has substantially altered the complexion of the market compared with a day ago, when investors were fretting over mutations of the coronavirus that causes COVID-19 in Europe.

Medical experts, however, have said that the vaccines should remain effective against the disease. President-elect Joe Biden received a vaccine during an on-camera event on Monday.

In the U.S. there were 201,723 new COVID-19 cases reported in the U.S. on Monday, up from 179,801 on Sunday, according to data provided by the New York Times.

In economic news, a final reading of U.S. gross domestic product in third quarter came in at a slightly stronger rate than had been estimated by economists surveyed by MarketWatch, at an annualized growth rate of 33.4% compared with a previous reading of 33.1%, as the economy claws back from pandemic lows.

Looking ahead, a report on consumer confidence from the U.S. Conference Board and a reading of existing home sales are due at 10 a.m. ET, along with a report on manufacturing activity in the Federal Reserve’s Richmond district.

Which stocks are in focus?

  • Apple IncAAPL, 1.88% shares were in focus after a report that the tech giant is targeting 2024 as the year it produces a passenger vehicle.
  • Shares of Sportsman’s Warehouse Holdings Inc. SPWH, 35.97% were being watched after news on Monday that it is being acquired by privately held Great American Outdoors Group, which already owns Bass Pro Shops, Cabela’s, White River Marine Group and nature-based resorts.
  • Shares of Peloton Interactive IncPTON, 11.16%  were also in focus after it announced Monday afternoon that it is acquiring another manufacturer of exercise equipment, Precor, at a valuation of $420 million.
  • Tesla shares TSLA, -1.12% were still in focus after the electric -vehicle maker made its debut in the S&P 500 index, putting in the worst performance, off 6.5%, of the lot.

How are other assets performing?

  • In Asian trading, the Shanghai Composite SHCOMP, -1.86% shed 1.9%, Hong Kong’s Hang Seng Index HSI, -0.71%  lost 0.7% and Japan’s Nikkei 225 declined 1%.
  • In Europe, the Stoxx 600 Europe SXXP, 0.91% was trading 0.8% higher, following its largest one-day percent plunge in about two months, while London’s FTSE 100 index UKX, 0.41%  picked up 0.7%.
  • The 10-year Treasury note yield  TMUBMUSD10Y, 0.924%  was holding steady at 0.93%. Yields and prices move in opposite directions.
  • Oil futures retreated, with the U.S. benchmark CL.1, -1.48% down 1.3%, after a sharp drop on Monday, currently trading at $47.34 a barrel early Tuesday.
  • Gold futures for February delivery GCG21, 0.11%  traded less than 0.1% lower at $1,882.20 an ounce, as a gauge of the U.S. dollar, the ICE U.S. Dollar Index DXY, 0.25%,  rose 0.2% to around 90.188.

This article was originally posted by MarketWatch.