logo |

News

    Home   >     Industry    >     Main body

    US Stocks Falter Amid Concerns Biden Stimulus Plan Would Lead to Higher Interest Rates, Corporate Taxes

    Abstract:Theres a chance that markets will have to pay for this in the form or sharply higher interest rates or tax hikes that could cap equity valuations.

      Wall Street‘s major stock indexes finished lower on Friday. Gains were capped as investors assessed the impact of President-elect Joe Biden’s $1.9 trillion stimulus plan with some suggesting higher corporate taxes would be necessary to pay for it. Also weighing on prices was a drop in U.S. big bank shares after their reports kicked off earnings season and a sharp break in energy due to the announcement of a regulatory probe into Exxon Mobil Corp.

      In the cash market on Friday, the benchmark S&P 500 Index settled at 3768.25, down 27.29 or -0.81%. The blue chip Dow Jones Industrial Average finished at 30814.26, down 177.26 or -0.65% and the tech-based NASDAQ Composite closed at 12998.50, down 114.14 or -1.02%.

      Bidens Stimulus Plan Caps Gains, Raises Concerns about Taxes

      Bidens proposal, called the American Rescue Plan, includes increasing the additional federal unemployment payments to $400 per week and extending them through September, direct payments to many Americans of $1,400, and extending the federal moratoriums on evictions and foreclosures through September.

      Bidens coronavirus relief stimulus package may prove a double-edged sword for investors, sustaining optimism for further economic revival while raising worries over how the United States will pay for it all.

      Investors didn‘t chase the market higher on Friday after Biden announced the package the evening before because it had been widely anticipated by Wall Street and has helped lift the broad S&P 500 Index nearly 3% in the week since Democratic challengers won both of Georgia’s U.S. Senate seats, giving Democrats full control of Congress.

      However, that rally has been mirrored by a slide in Treasuries, due in part to expectations that the government will need to fund the spending with more debt issuance and nudging borrowing costs throughout the economy higher.

      On the other side, theres a chance that markets will have to pay for this in the form or sharply higher interest rates or tax hikes that could cap equity valuations.

      Bank Stocks Drag S&P Lower

      The S&P 500 Banks Index Lost Ground as shares of Wells Fargo & Co, JPMorgan Chase & Co and Citigroup Inc tumbled even though they had posted better-than-expected fourth-quarter profits. The bank sector had rallied sharply in recent days.

      JPMorgan Chase on Friday beat analysts estimates for fourth-quarter profit on record trading results and a boost from releasing money previously set aside for loan losses.

      Wells Fargo released mixed results for the fourth quarter, sending the bank‘s stock lower. Earnings per share of 64 cents exceeded Refinitiv’s estimate of 60 cents, but revenue of $17.93 billion fell short of the $18.127 billion forecast

      Citigroup posted fourth-quarter results that beat analysts estimates for profit as the firm joined rival JPMorgan Chase in releasing reserves for loan losses.

      Wells Fargo, down 7.8%, was among the biggest drags on the S&P 500.

      Exxon Reportedly Investigated by SEC

      Shares of Exxon slipped more than 5% on Friday after The Wall Street Journal reported that the Securities and Exchange Commission opened an investigation that the Securities and Exchange Commission opened an investigation into the oil giant over how it valued a key asset in the oil-rich Permian Basin.

    Latest News

    United Arab Emirates Dirham

    • United Arab Emirates Dirham
    • Australia Dollar
    • Canadian Dollar
    • Swiss Franc
    • Chinese Yuan
    • Danish Krone
    • Euro
    • British Pound
    • Hong Kong Dollar
    • Hungarian Forint
    • Japanese Yen
    • South Korean Won
    • Mexican Peso
    • Malaysian Ringgit
    • Norwegian Krone
    • New Zealand Dollar
    • Polish Zloty
    • Russian Ruble
    • Saudi Arabian Riyal
    • Swedish Krona
    • Singapore Dollar
    • Thai Baht
    • Turkish Lira
    • United States Dollar
    • South African Rand

    United States Dollar

    • United Arab Emirates Dirham
    • Australia Dollar
    • Canadian Dollar
    • Swiss Franc
    • Chinese Yuan
    • Danish Krone
    • Euro
    • British Pound
    • Hong Kong Dollar
    • Hungarian Forint
    • Japanese Yen
    • South Korean Won
    • Mexican Peso
    • Malaysian Ringgit
    • Norwegian Krone
    • New Zealand Dollar
    • Polish Zloty
    • Russian Ruble
    • Saudi Arabian Riyal
    • Swedish Krona
    • Singapore Dollar
    • Thai Baht
    • Turkish Lira
    • United States Dollar
    • South African Rand
    Current Rate  :
    --
    Amount
    United Arab Emirates Dirham
    Available
    -- United States Dollar
    Risk Warning

    The Database of WikiFX comes from the official regulatory authorities , such as the FCA, ASIC, etc. The published content is also based on fairness, objectivity and fact. WikiFX doesn't ask for PR fees, advertising fees, ranking fees, data cleaning fees and other illogical fees. WikiFX will do its utmost to maintain the consistency and synchronization of database with authoritative data sources such as regulatory authorities, but does not guarantee the data to be up to date consistently.

    Given the complexity of forex industry, some brokers are issued legal licenses by cheating regulation institutes. If the data published by WikiFX are not in accordance with the fact, please click "Complaints "and "Correction" to inform us. We will check immediately and release the results.

    Foreign exchange, precious metals and over-the-counter (OTC) contracts are leveraged products, which have high risks and may lead to losses of your investment principal. Please invest rationally.

    Special Note, the content of the Wikifx site is for information purposes only and should not be construed as investment advice. The Forex broker is chosen by the client. The client understands and takes into account all risks arising with Forex trading is not relevant with WikiFX, the client should bear full responsibility for their consequences.