U.S. stock futures wavered Wednesday, following the S&P 500’s shuffle to a record close, with negotiations stalled for further coronavirus aid and rising tensions between Washington and Beijing.
Futures tied to the S&P 500 were nearly flat. The benchmark stock index’s sharp rally since late March, fueled in part by stimulus measures from the central bank and the government, has erased its historic plunge this year, leaving the S&P 500 up 4.9% for the year.
A string of economic figures in recent weeks has pointed to signs of a rebound in the American labor market, the manufacturing sector, retail sales and consumer spending. Optimism among some people that the U.S. may be on its way to a quick recovery has helped trigger a rally in stocks across a range of sectors, though others remain nervous about the sustainability of the economic rebound.
The market has for some weeks also been counting on additional stimulus spending by the government to bolster consumer confidence. But talks between Republicans and Democrats remain stalled, Treasury Secretary Steven Mnuchin said Tuesday, though bipartisan appetite for a deal remains high. Negotiations with House Speaker Nancy Pelosi may resume this week, he said.
“There’s a strange combination of things going on at the moment: There’s some better economic data, proving to be a bit supportive of equities, but running alongside that are the fiscal risks in the U.S. and the weaker dollar,” said Georgina Taylor, a multiasset fund manager at Invesco. “I don’t think the moves in markets are very consistent.”