By Anna Hirtenstein
U.S. stock futures edged up Friday, signaling that markets will end the week on an upbeat note with major indexes near all-time highs.
Futures tied to the Dow Jones Industrial Average edged up 0.2% ahead of a short trading session, with markets scheduled to close at 1 p.m. ET. The blue-chips index earlier this week breached the 30000 milestone for the first time in its history, before sliding lower Wednesday. Trading was suspended Thursday for the Thanksgiving holiday.
Contracts linked to the S&P 500 also ticked 0.2% higher, suggesting that the broad-market gauge may erase its tepid loss from Wednesday. The index had climbed to a record Tuesday.
Major technology stocks, in particular, are poised to extend a rally that sent the Nasdaq Composite to its 44th record closing level of 2020 on Wednesday. Futures linked to the Nasdaq-100 index advanced 0.4% Friday.
Markets have been buoyant this week despite rising coronavirus infection levels across the U.S. and economic data pointing to a halting recovery that may curb consumer confidence. Investors appear to be looking ahead to next year, betting that Covid-19 vaccines will curb the pandemic and allow social and business activity to return to normal.
"The hopefuls are leading the realists: they believe that the economy will return to an equilibrium with a high growth rate. They are looking beyond the shock," said Sebastien Galy, a macro strategist at Nordea Asset Management. "It's a matter of time though: there are still deep underlying issues with Covid spiking in the U.S."
The number of people hospitalized in the U.S. due to coronavirus surpassed 90,000 for the first time. More than 110,000 new cases were reported around the nation Thursday, sharply lower than totals in recent days. But infection levels are likely to rise again because of large gatherings and reunions for the Thanksgiving Day celebrations.
"There's still a lot of cases and restrictions in the U.S.: a lot of activity is going to stall again," said Samy Chaar, chief economist at Lombard Odier. "This will have an impact potentially on the next job market report," he said, referring to labor-market figures for November that will be released on Dec. 4.
President Trump said Thursday that he would leave the White House if the electoral college backs Joe Biden, further helping alleviate concerns about investors about political uncertainty in coming weeks. The president's campaign has lost several legal challenges that allege election fraud, and he has come under pressure from Republicans to accept the results.
"He lost big enough for this election to be very difficult to contest. It's a done deal for markets," said Mr. Chaar. "Everyone is working under the assumption that it will be a Biden administration."
Ahead of the New York opening bell, Slack Technologies dropped over 4%. The stock had soared 37% Wednesday after The Wall Street Journal reported that Salesforce.com is in advanced talks to buy the company.
The yield on the benchmark 10-year Treasury note fell to 0.862%, from 0.878% on Wednesday. The U.S. government-bond market was closed Thursday.
In commodity markets, copper rose over 2% on expectations that demand from China will increase and due to a recent fall in global inventories.
Meanwhile, Black Friday kicks off the traditional start of the crucial holiday shopping season in the U.S. Investors will be closely watching metrics such as e-commerce and mobility data to try to gauge consumer confidence and the extent that the pandemic and historically-high levels of unemployment will weigh on the retail sector.
"Given the difficult year for so many retailers, there's definitely going to be expectations for them to try to play catch up," said Esty Dwek, head of global market strategy at Natixis Investment Solutions. Black Friday "should give a nice bump to the [economic data] numbers."
Overseas, the pan-continental Stoxx Europe 600 wavered between muted gains and losses. The U.K. was the worst-performing stock market in Europe Friday, with the benchmark FTSE 100 index sliding 0.4%.
Talks between British and European Union negotiators on a trade deal continue, with both sides having just weeks, at best, to reach an agreement. The U.K. government also announced new restrictions on Thursday to stem the spread of the virus as infection levels remain elevated, with England split into tiers that determine the scope of limitations on activity.
"The uncertainty around Brexit and the tiers system that is slightly tougher, that is outweighing any vaccine optimism," said Michael Hewson, a chief markets analyst at CMC Markets.
Among European equities, Banco de Sabadell plunged over 12% and Banco Bilbao Vizcaya Argentina rose more than 2% after the Spanish banks called off their merger talks due to disagreements on pricing.
In Asia, most major stock benchmarks gained by the close of trading. The Shanghai Composite Index climbed 1.1% and Hong Kong's Hang Seng Index added 0.3%. Profits at China's industrial firms in October rose over 28% from a year earlier, an acceleration from the 10% rise the previous month, in yet another sign of the strength of the country's recovery.
Write to Anna Hirtenstein at email@example.com
(END) Dow Jones Newswires