Topline
Stocks are ushering in the second quarter of the year with solid gains and near record highs as investors brush off concerns over higher taxes and focus on the trillions of dollars in government spending that should bolster growth in the broader market and sectors like construction and green energy specifically.
President Joe Biden delivers a speech on infrastructure spending in Pittsburgh on Wednesday, March ... [+]
Key Facts
Shortly after the market open, the Dow Jones Industrial Average ticked up 39 points, or 0.1%, while the S&P 500 climbed 0.4%, and the tech-heavy Nasdaq, which has underperformed this year amid spiking Treasury yields, jumped 1.1%.
Heading up gains in the S&P, shares of Sherwin-Williams are up 3% on the paint-maker's first day of trading on a stock split, while construction company Jacobs Engineering and electric-vehicle-chemical supplier Albemarle—both beneficiaries of President Joe Biden's green-focused infrastructure plan—climb about 1% and 3%, respectively.
Budget airline Frontier Group has raised $570 million for its Thursday public market debut, offering 30 million shares for $19 apiece, the low end of the firm's initial price range.
Meanwhile, Carmax shares are leading the S&P's few underperformers, falling 4% after the firm reported lower-than-expected quarterly sales of nearly $5.2 billion, up just 4% year over year due in part to the severe winter weather across the U.S. that stunted production and negatively impacted retail sales.
Shares of Johnson & Johnson are down 1% after 15 million doses of its Covid-19 vaccine were reportedly spoiled at a Baltimore factory run by Emergent BioSolutions, whose shares are slipping 7% Thursday.
Despite the still-booming stock market, jobless claims last week totaled a much higher-than-expected 719,000, up nearly 10% from one week prior as the labor market continues to struggle with pandemic-induced layoffs.
Crucial Quote
"News that President Biden is ready to inject another $2 trillion into the world's largest economy has been well received," Oanda Market Analyst Sophie Griffiths said in a Thursday note, adding that bullishness over the huge cash injection to improve roads, railways, broadband and clean energy is, at least temporarily, overshadowing concerns over higher corporate taxes. "Investors are already pricing in the read-across effect, and a boost to the U.S. economy is good news for the global economy."
Key Background
Rising interest rates have created headwinds for high-priced stocks in recent weeks, and that's hit the booming tech sector particularly hard, with the Nasdaq down 6% from a February high. Still, the broader market continues to rally, pushing the Dow and S&P to new highs just this week as investors eye the trillions of dollars in stimulus spending that should help usher in an economic recovery.
What To Watch For
Monthly jobs data from the Bureau of Labor Statistics should provide further clarity on the job market's impending recovery. Brad McMillan, the chief investment officer for Commonwealth Financial Network, says the report is expected to show that the U.S. economy added about 600,000 jobs last month—which would be the biggest growth in the past five months and up from 379,000 in February. "We are still 9.5 million jobs below pre-pandemic levels, so there is substantial room for growth, and unemployment levels are still high enough to provide willing workers," McMillan said in a Thursday note.
Further Reading
Unemployment Claims Climb To 719,000 After Hitting Pandemic Low Last Week (Forbes)
Here's What's In Biden's $2 Trillion Infrastructure Plan (Forbes)
Semiconductors, 5G And Electric Car Parts: Stocks To Watch As Biden Pushes Infrastructure Bill (Forbes)
