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Wall Street set for higher open with eyes on Biden's stimulus plan

Kitco News

(Reuters) - Wall Street’s main indexes were set to open slightly higher on Thursday with investors awaiting details on President-elect Joe Biden’s proposals for stimulus to jump-start the economy as data showed a struggling job market recovery.

The Labor Department’s report showed the number of Americans filing for unemployment benefits increased more than expected to 965,000 last week from 787,000, underscoring the impact of a resurgence in COVID-19 infections.

However, Wall Street’s main indexes are near record highs and the S&P 500 has risen in six of the past eighth sessions this year as investors count on President-elect Joe Biden to unveil a stimulus plan on Thursday evening that could exceed $1.5 trillion.

“Markets remain cautious ... there is a little bit of a fear of ‘sell on the news’ that when (stimulus) is actually introduced, it won’t be as large as some people like or it’s possible that market will start to look at how it’s going to be paid for,” said Rick Meckler, partner, Cherry Lane Investments, a family investment office in New Vernon, New Jersey.

“For a while investors have been looking forward to what the picture might be like once the vaccine is fully distributed and the worst parts of the pandemic over.”

Analysts have said near-term political uncertainties in Washington, a relentless rise in coronavirus cases and a slower than expected rollout of vaccines could impede gains for equities in the short-term.

President Donald Trump became the first president in U.S. history to be impeached twice when the House voted 232-197 on Wednesday to charge him with inciting riots at the Capitol. The impeachment proceedings threaten to hang over the beginning of Biden’s term.

At 8:31 a.m. ET, Dow E-minis were up 78 points, or 0.25% and S&P 500 E-minis were up 3.25 points, or 0.09%. Nasdaq 100 E-minis were down 2.75 points, or 0.02%.

Tesla Inc dropped 1% premarket after the electric-car maker was asked to recall 158,000 Model S and Model X vehicles in the United States for touchscreen failures that could lead to safety risks.

U.S.-listed shares of Taiwan Semiconductor Manufacturing Co Ltd rose 2.3% after it posted its best-ever quarterly profit and hiked revenue and capital spending estimates to record levels as it forecast “multiple years of growth opportunities”.

BlackRock Inc added 1.2% and was set for a record open after the world’s largest asset manager reported a better-than expected quarterly profit, driven by increased activity in financial markets that pushed its assets under management soaring.

Attention is shifting to the earnings season with results from JPMorgan and Citigroup and other big banks slated for Friday.

First-quarter and 2021 corporate guidance will be key for investors as new lockdowns threaten to push back a recovery in corporate earnings, according to investment banks.

Reporting by Devik Jain and Medha Singh in Bengaluru; Editing by Maju Samuel

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