US stock index futures rose Thursday morning as markets resumed February momentum.
Dow-linked futures contracts rose 79 points. S&P 500 futures and Nasdaq 100 futures were also trading in slightly positive territory.
The move comes after the Dow has advanced 63 points during regular trading hours and closed at a record high. The Dow also hit its ninth intraday high of the year in a volatile session where the average 30-share price swung between gains and losses.
The S&P 500 and Nasdaq Composite also hit record highs on Wednesday, but the indices ultimately failed to sustain those gains. The S&P closed 0.03% while the Nasdaq lost 0.25%.
Federal Reserve Chairman Jerome Powell said Wednesday that the economy was facing challenges in the labor market and that monetary policy must therefore remain “patiently accommodating”. In a remark at the New York Economic Club, Powell said the employment picture is a “long way” from where it needs to be.
“Powell held onto his guns today,” said Ryan Detrick, LPL Financial’s chief market strategist. “With worries about too many incentives and higher inflation, he’s more concerned about a persistent employment picture. The truth is, low rates will remain for the foreseeable future and today’s speech has done little to change that,” he added.
For the week, all three major averages are higher and on track to post their second positive week in a row. At the beginning of the month, the indices for February are also higher. The Russell 2000 continues to draw attention and the small cap index outperforms the S&P for the week, month and year so far.
Washington is currently on business cycle talks, with investors expecting additional bailout measures to further support stocks.
“Markets expect a great deal of stimulus to be pumped into the economy,” said Scott Wren, senior global markets strategist at Wells Fargo Investment Institute. “We believe that extra momentum is needed to help the business community and consumers bridge the gap between now and vaccine lifts and bans,” he added.
A busy week of wins continues on Thursday. PepsiCo, Kraft Heinz and Kellogg are among the names to be reported before the market opens. Disney and Expedia will be giving their quarterly reports after the bell on Thursday.
According to a CNBC analysis, more than 80% of the S&P 500 components that have reported gains to date have exceeded Wall Street expectations.
“As we move through February, we’ve reopened states, the virus is waning, and vaccinations are spreading rapidly. Looking back, jobs have declined, layoffs have increased, and confidence has fallen,” said Brad McMillan, chief investment officer for the Commonwealth Financial Network.
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