A woman takes a selfie with a statue of ‘The Bull That Fills’ on February 17, 2021 in New York City.
ANGELA WEISS AFP | Getty Images
Futures fell early Tuesday after the industry average of the Dow Jones and S&P 500 closed at a record high as strong economic data boosted hopes for a smooth recovery.
Dow industry-related futures indicated an initial loss of about 30 points. S&P 500 futures and Nasdaq 100 futures also traded partially lower.
Wall Street rallied to record levels on Monday after a report of job blows on Friday, and a sharp measurement of activity in the service industry showed that the economic recovery has gained momentum due to the accelerated introduction of the vaccine.
“Vaccinations are being announced at a record high, and Congress’s efforts to encourage historic steps have paved the way for continued positive market momentum,” said Chris Larkin, executive director of trade and product investment at E-Trade Financial.
Bond yields had another quiet session with a ten-year Treasury yield that was stable at 1.71%, alleviating fears of rising inflation.
Cleveland Federal Reserve President Loretta Mester told CNBC on Monday she is mostly worried until this year’s increase in government bond yields.
“I think higher bond yields are quite understandable in the context of improving the economic outlook. The increase was a regular increase,” Mester said. “So I’m not worried about rising yields at the moment. I don’t think the Fed has anything to react to.”
Investors continue to estimate President Joe Biden’s $ 2 trillion infrastructure proposal and his chances of it becoming a reality. Although politicians on both sides of the aisle support funding for the reconstruction of U.S. roads and bridges, disagreements over other priorities and the final size of the law remain. There is also discussion of Biden’s plan to increase corporate taxes to 28% in part to fund the plan.
Biden said Monday not worried that an increase in income taxes would harm the economy. A Conservative Democrat, Sen. Joe Manchin of West Virginia, reportedly said he opposed the proposed tax increase to 28%.