Here are today’s market moves:
S&P 500 down 0.72% to 3,768.25
Dow Jones down 0.57% to 30,814.26
Nasdaq down 0.87% to 12,998.50
Gold: $1,827
Bitcoin: $36,371
US10Y: 1.087%
What happened?
U.S. stocks fell on Friday after President-elect Joe Biden unveiled a $1.9 trillion Covid-19 relief plan and the December retail-sales report came in weaker than expected, underscoring the coronavirus pandemic’s continued effect on the economy.
Friday’s retail-sales report underscored the need for some kind of economic aid. U.S. consumers cut back on spending in December, the peak of the holiday season, as the country confronted a surge in coronavirus infections.
As virus cases keep climbing in many parts of the world, anticipation of Mr. Biden’s spending plans have helped keep stock benchmarks in the United States close to record levels.
Mr. Biden said Thursday night that his plan would address the “real pain overwhelming the real economy,” with money to quicken the rollout of the coronavirus vaccine, help for state and local governments to address budget shortfalls, more generous jobless benefits and direct payments of $1,400 to individuals.
For several months, the markets have been riding a number of strong trends that have powered everything from large-cap stocks to bitcoin to record highs. Underlying all of it has been a bet on government and central-bank aid to offset the damage wrought by the pandemic.
Investors are hoping that additional spending will help steer the U.S. economy through a winter that has seen high Covid-19 infection rates and worsening economic data. Figures released Thursday showed that the number of workers filing for jobless benefits posted its biggest weekly gain since the pandemic hit last March.
Investors are also looking closely at the enormous amount of borrowing that will be necessary to finance Mr. Biden’s proposal. Already, Treasury bonds have sunk in value, and their yields risen. As yields inch up, borrowing costs will rise. That has also raised concerns about tax increases to help underwrite Mr. Biden’s proposal.
This Week
Monday: Earnings expected from Synnex
Tuesday: Earnings expected from Albertsons
Wednesday: Earnings expected from Infosys and IHS Markit
Thursday: Weekly jobless claims. Earnings expected from Delta and BlackRock
Friday: Earnings expected from JPMorgan Chase, Wells Fargo, and Citi