Friday December 11th

11-12-2020

Dow futures sink more than 200 points as stimulus deal remains unresolved

U.S. stock index futures were lower early Friday as the outlook for additional fiscal stimulus remained uncertain. Futures on the Dow Jones Industrial Average indicated an opening loss of more than 200 points. S&P 500 futures fell 0.9%. Nasdaq 100 futures slid 0.9%. The S&P 500 was set to fall for a third day on Friday as negotiations over a coronavirus relief deal dragged on. Lawmakers seek to pass a bill before lifelines expire at the end of 2020, but disagreements over state and local stimulus, unemployment assistance and stimulus checks still exist. Senate Majority Leader Mitch McConnell’s staff informed congressional leadership offices that Senate Republicans likely would not support a $908 billion bipartisan proposal, according to NBC News. Earlier on Thursday, House Speaker Nancy Pelosi said that bipartisan negotiations were leading to “great progress.” “The tenor of headlines out of Capitol Hill around stimulus sounded a bit better than Mon-Wed but there’s still no sign of a breakthrough,” Adam Crisafulli, founder of Vital Knowledge, said in a note Thursday. The House has passed a one-week federal spending extension to avoid a shutdown through Dec. 18 to buy more time to reach a stimulus agreement. Share of companies hardest hit by the pandemic recession fell in premarket trading Friday. Carnival, United Airlines and Gap each fell more than 2% in premarket trading. The Dow and the S&P 500 are down 0.7% and 0.8%, respectively, this week, on pace for their first negative week in three. The tech-heavy Nasdaq Composite has dipped 0.5% during the same period, headed for its first losing week in four. Without fresh stimulus, millions of Americans could lose unemployment benefits in the new year. Meanwhile, weekly jobless claims jumped last week to 853,000, the highest total since Sept. 19, as new lockdown restrictions weighed on businesses amid rising coronavirus cases. The futures losses came even as a key Food and Drug Administration advisory panel recommended the approval of Pfizer and BioNTech’s coronavirus vaccine for emergency use. The  recommendation marked the last step before the FDA gives the final approval to broadly distribute the first doses throughout the U.S. Bucking the trend in early trading was Disney. On Thursday, the company said its Disney+ service has 86.8 million subscribers and expects have between 230 million to 260 million subscribers by 2024. The stock rose 7% in premarket trading. Asia-Pacific markets traded mixed on Friday as investors kept an eye on negotiations over additional fiscal stimulus in the U.S. South Korea’s Kospi index rose 0.86% to 2,770.06 while the Kosdaq was up 0.73% to 928.44. In Japan, the Nikkei 225 declined 0.39% to 26,652.52 while the Topix index rose 0.33% to 1,782.01. Hong Kong’s Hang Seng index advanced 0.44% in afternoon trade. Chinese mainland shares declined: The Shanghai composite was down 0.77% at 3,347.19, the Shenzhen composite lost 1.31% to 2,223.94 and the Shenzhen component fell 1.28% to 13,555.14. Oil prices eased on Friday but were set for a sixth week of gains, as the rollout of novel coronavirus vaccination programmes fed hopes that demand for fuel would rebound next year. Brent was down 16 cents or 0.3% at $50.09 a barrel, after rising above $51 a barrel on Thursday to an early-March high. U.S. oil was down 10 cents, or 0.2%, at $46.68 a barrel, having risen almost 3% in the previous session. Gold prices were listless on Friday, with gains kept in check by a slight uptick in the dollar and caution setting in as investors grappled with a delay in a U.S. COVID-19 relief package. Spot gold was little changed at $1,834.55 per ounce. U.S. gold futures were flat at $1,838.10.