US stock index futures fell Monday during overnight trading after the Dow and S&P closed at record highs on optimism about the economic reopening.
Dow-linked futures contracts fell 57 points. S&P 500 futures were down 0.15% while Nasdaq 100 futures were down 0.11%.
During Monday’s regular trading hours, the Dow rose 174 points, hitting the 21st intraday record high of the year and the 14th record high of 2021. It was also the seventh consecutive positive session of the 30-stock average – the longest daily Winning streak since August.
The S&P 500 gained 0.64% for the fifth time in a row. The benchmark index reached its 16th intraday high of the year and its 13th record high.
The Nasdaq Composite was the relative outperformer on Monday, up 1.05% and recouping some of its recent losses.
Big tech stocks and reopening economic games like airlines drove higher averages as coronavirus vaccine rollouts continue.
“The distribution of COVID-19 vaccines brings us closer to a fully reopened economy and is probably the single most important factor in assessing the economic growth outlook for 2021,” said LPL Financial strategists. “We expect interest rates to fall as a threat to the markets,” added the company.
The 10-year Treasury yield stood at 1.6% on Monday after hitting its highest level in more than a year on Friday. The recent surge in bond yields has resulted in a rotation of growth names as companies’ future cash flows appear less attractive compared to other assets.
“After an approximately 14-year cycle of outperformance, the dominance of growth relative to value peaked in autumn 2020,” said Keith Lerner, Chief Market Strategist at Truist. “We are still seeing higher value relative to growth over the next 12 months as the value underperforms dramatically over the long term and the US economy is at its peak of its best growth in more than 35 years.”
On Tuesday, Lennar and CrowdStrike will be among the companies to show profits. February retail sales data is expected to be released in addition to home builder sentiment data from the National Association of Home Builders.
In the meantime, the Federal Reserve will begin its two-day meeting on Tuesday, followed by a statement and briefing from Chairman Jerome Powell on Wednesday.