Stock futures opened higher late Tuesday, after ending the regular session slightly below all-time highs in one of the final trading days of 2020.
The Dow, S&P 500 and Nasdaq each touched intraday record highs on Tuesday before cutting gains and turning negative. The small-cap Russell 2000 (^RUT) underperformed with a 1.9% drop, unwinding some of its outperformance against its large-cap counterparts for the month-to-date.
Tuesdayâ€™s moves lower came after prospects that consumers might receive bigger direct checks to stoke spending appeared to diminish. Though House of Representatives passed a measure to increase stimulus checks to $2,000 to most Americans, Senate Majority Leader Mitch McConnell scuttled Democratic senatorsâ€™ efforts to quickly advance the payment increase in the Senate on Tuesday. He also suggested the chamber would only consider the measure in tandem with other provisions unpopular with Democratic lawmakers.
Trading volume among U.S. equities has been relatively light during this holiday-shortened week, and equity trading on U.S. exchanges will close all day on Friday for New Yearâ€™s Day. With Congressâ€™s $900 billion stimulus bill passed and few notable economic releases and no major earnings releases left on the docket for 2020, investors have attempted to look ahead for new market catalysts.
However, with the S&P 500 already tracking toward a total return of more than 17% through Tuesdayâ€™s close, some strategists have struck a more cautious tone for the very near-term heading into the new year.
â€œThis market continues to defy physics. Itâ€™s another week and another all-time high,â€ Tony Zabiegala, senior wealth advisor at Strategic Wealth Partners, told Yahoo Finance on Tuesday. â€œBut Iâ€™m really struggling to understand how weâ€™re in a better spot today â€“ stimulus checks or not â€“ than we were a year ago pre-Covid, pre-lockdowns, all that.â€
â€œI feel that we really pulled forward those 17% of gains from 2021 already,â€ he added. â€œTechnicals are pointing to a continued market melt-up. However a quick market correction to start off the year wouldnâ€™t surprise me at all. Weâ€™ve had slowing economic data and that is the biggest catalyst in my eyes … Iâ€™m just struggling to find organic growth catalysts, and itâ€™s being very difficult to find something to grab onto.â€
The S&P 500
6:01 p.m. ET Tuesday: Stock futures tick higher
Here were the main moves in markets as the overnight session kicked off Tuesday evening:
S&P 500 futures (ES=F): 3,724.25, up 4.25 points or 0.11%
Dow futures (YM=F): 30,265.00, up 27 points or 0.09%
Nasdaq futures (NQ=F):Â 12,855.25, up 14.25 points or 0.11%