Tuesday January 4th


Dow futures rise 100 points ahead of the first trading day of 2022

U.S. stock index futures rose sharply in premarket trading Monday, with investors showing hope about the economy’s ability to overcome the surge in Covid cases and focusing on progress from the nation’s automakers. Futures tied to the Dow Jones Industrial Average jumped 109 points, or about 0.3%. Both S&P 500 futures and Nasdaq 100 futures advanced about 0.3%. Stocks have a tendency to gain in the start of a new year as investors look to put new money to work, Bank of America noted on Monday. The S&P 500 was up in the first week of the calendar year in 11 of the last 13 years, with an average gain of about 1.6%, the firm found. Tesla helped the market generate some early momentum Monday, rising 6.8% in premarket trading after the electric vehicle company reported 308,600 deliveries in the fourth quarter, beating expectations. Along with Tesla, big automakers also saw their shares climb premarket, with Ford Motor and General Motors each climbing 1.6%. Reopening stocks also pushed higher in early action. Airlines edged higher as investors shrugged off concerns about holiday flight cancelations that have extended into Monday. United Airlines gained 1% and Alaska Air rose 2.3%. Meanwhile, casino stocks including Las Vegas Sands and Wynn Resorts gained about 1% apiece premarket. The move in futures comes after markets closed out a strong 2021 last week. The S&P 500 rose nearly 27% for the year, with the Nasdaq Composite and Dow also posting large returns. Stocks fell slightly on Friday, but the S&P 500 and Dow were positive for the final week of the year. The new year starts with continued uncertainty around the Covid-19 pandemic. The rise of the omicron variant helped lead to the thousands of flight cancellations during the holiday season and has led some businesses and schools to consider temporary closures. Also, several major Wall Street banks have asked employees to work from home for the first few weeks of January. Infectious disease expert Dr. Anthony Fauci told ABC’s “This Week” on Sunday that U.S. health officials may soon update guidelines to include a testing recommendation to signal when a person who previously tested positive for Covid can leave isolation. Inflation and monetary policy are also expected to be key themes for 2022, as investors expect the Federal Reserve to hike rates multiple times in the coming year to help cool the rise in prices for consumers. “Just as for the economy as a whole, the market story for 2022 will be a return to normal. As hiring continues, spending grows, and businesses hire and invest, the economy will be normal. The government is normalizing policy on the same expectations. When you look at the macro picture, the overarching theme is 2022 will bring us back to something like normal,” Brad McMillan, chief investment officer for  Commonwealth Financial Network, said in a note to clients on Friday. The first week of the year will be a busy one for economic data, with the key December jobs report slated for a Friday morning release. On Monday, investors will get updated looks at manufacturing activity and construction spending. Shares in Asia were mixed on Monday as trading in 2022 kicked off, with some major markets in the region closed. Hong Kong’s Hang Seng index shed earlier gains closed 0.53% lower at 23,274.75. Elsewhere, South Korea’s Kospi gained 0.37% to close at 2,988.77 while the Taiex in Taiwan advanced 0.28% on the day to 18,270.51. In Southeast Asia, the Straits Times index in Singapore climbed about 0.4%, as of about 4:30 p.m. local time. Markets in Australia, mainland China and Japan were closed on Monday for a holiday. Oil rose towards $79 a barrel on Monday supported by tight supply and hopes of further demand recovery in 2022 spurred in part by a view that the Omicron coronavirus variant is unlikely to significantly dampen the outlook. Libyan oil output will be cut by 200,000 barrels per day for a week due to pipeline maintenance. OPEC and its allies, known as OPEC+, are expected to stick to a plan to raise output gradually at a meeting on Tuesday. Brent crude rose 95 cents, or 1.2%, to $78.73 a barrel as of 0923 GMT. U.S. West Texas Intermediate (WTI) crude added $1.03 or 1.4%, to $76.24. Gold prices slipped on Monday as higher bond yields and rallying equities weighed on the metal’s safe-haven appeal as the new year gets under way, pushing it down from a six-week peak hit earlier in the session. Spot gold fell 0.3% to $1,823.63 an ounce by 1131 GMT, having touched its highest since Nov. 22 at $1,831.62. U.S. gold futures edged 0.1% down to $1,826.40.