Futures mixed, Wall Street takes a breath after Dow hits 30,000

Wall Street consolidated its gains on Wednesday, with stock futures pointing to a flat to slightly mixed open after key benchmarks were scaled to new highs.

Ahead of Thanksgiving in the US, optimism about the upcoming use of a COVID-19 vaccine drove the Dow Jones Industrial Average above 30,000 A stunning rally for the first time on Tuesday that pushed stocks deep into the bull market.

However, caution was warranted early Wednesday as investors looked at US growth data and weekly jobless claims that were expected to have a job market that is still struggling under the weight of the pandemic.

The Russell 2000 (FURROW) Index also set a new peak and the Dow (^ DJI) rose over 13% in November – more than 10,000 points higher than the multi-year low in March when panic broke out over the spread of the virus’s crater-like global markets. The S & P 500 (^ GSPC) is just below a new record high. Analysts expect the index to break 3800 sooner rather than later.

“The recovery is intact and the world is likely to open up again in the [second half of 2021]But a lot of optimism is being priced in at vaccination / recovery, ”Bank of America said late Tuesday. “The risk of vaccine execution, delayed fiscal incentives, and prolonged lockdowns are risks.”

Tech-heavy Nasdaq, which was knocked down when investors switched from the stalwarts “stay at home” and benefited from coronavirus lockdowns, also posted strong gains. In early stores, Tesla (TSLA) hit a new record high and now has a market cap north of $ 500 billion – even before it joins the S&P 500.

Investors also welcomed the news that President-elect Joe Biden was ready to appoint former Federal Reserve Chair, Janet Yellen, treasured by Wall Street, as Secretary of the Treasury. The Trump administration has officially started the transition process despite President Donald Trump’s refusal to grant a concession.

Although a relentless wave of new COVID-19 infections has hit the global economy – resulting in hospitalizations and deaths – major drug manufacturers have warned that vaccination is imminent.

On Monday, Oxford University and AstraZeneca (AZN) showed that their candidate showed 70.4% effectiveness In two large-scale paths: when a lower dose is used, then a second, full dose, effectiveness is up to 90%, the company said. Separately Pfizer (PFE) and BioNTech (BNTX) to announce plans to apply for an emergency permit with the US Food and Drug Administration that would Allow them to have their vaccine used in the USA from December.

A fully vaccinated public is seen as a boom to devastated service industries such as travel, leisure and entertainment.

“We are still convinced of our arguments in favor of above-consensus GDP growth in 2021 and 2022,” wrote Goldman Sachs analysts last week.

“However, the rapid and widespread resurgence of the coronavirus has led us to downgrade our GDP projections for Q4 and Q1. We now expect annualized growth of + 3.5% and + 1.0% in the fourth and first quarters, ”the bank said – a significant downward revision from previous estimates of + 4.5% and + 3.5%, respectively.

“However, the greater resistance in winter should mean an even greater acceleration due to mass immunization,” which will spur growth from the second quarter of next year, Goldman said.

Expectations for vaccines to be launched relatively quickly point to growth in 2021 as investors play tech-heavy “stay at home” bets that previously featured major stocks like Netflix (NFLX), Amazon (AMZN), Zooming (ZOOM) and other names. Both the Dow (^ DJI) and S & P 500 (^ GSPC) notched record highs last week when traders rode a wave of exuberance sparked by the vaccine news.

The near-term outlook, however, remains clouded by the relentless scourge of further COVID-19 infections and the inability of Washington’s warring parties to agree on an incentive. The current wave of viruses is inundating the darkest days of March and April, threatening to overshadow the holidays and affect growth.

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8:30 am ET: unemployment claims worse than expected

The troubled US labor market absorbs a new wave of unemployedWith 778,000 new jobless claims filed in the last week, rising COVID-19 hospital stays and deaths are pushing back business restrictions. That number was worse than Wall Street’s consensus estimates and shows how the surge in the virus is affecting an already-ailing market for displaced people.

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