U.S. stock futures were flat in overnight trading on Tuesday, building on recent strength that has brought the major averages to record highs.
Dow futures fell 45 points. S&P 500 futures fell 0.02% and Nasdaq 100 futures gained 0.08%.
Dow component Salesforce announced it is acquiring messaging platform Slack for $27.7 billion after the bell on Tuesday. The Slack deal marks the cloud software vendor’s largest deal ever.
The major averages popped on Tuesday, the first day of December, adding to their sharp gains from the previous month. The Dow climbed 185 points, helped by a 3% jump in Apple’s stock. The 30-stock average hit an intraday record in Tuesday’s session.
The S&P 500 climbed 1.13% to close at a record high. The Nasdaq Composite also notched a new record, closing up 1.3%, as the mega-cap tech stocks all closed in the green.
“The beginning of Covid-19 vaccinations is getting close, bringing ‘buy on any dip’ to the forefront,” Jim Paulsen, chief investment strategist at the Leuthold Group, told CNBC. ”After a weaker Monday session, Tuesday brought investors looking for an opportunity to increase risk-on exposures. Activity was further boosted today by bond yields rising in concert with a stronger stock market adding to optimism that recent economic momentum may remain healthy despite the winter Covid-19 case surge.”
Sentiment got a boost after a group of lawmakers unveiled a $908 billion stimulus plan, however, Senate Majority Leader Mitch McConnell rejected the proposal later in the day. Still, investors are hopeful for a second stimulus package in the lame-duck period for Congress.
Stocks are coming off of their best month in more than three decades. The Dow gained more than 11% in November, notching its best one-month performance since January 1987. The S&P 500 and Nasdaq Composite rose 10.8% and 11.8%, respectively, for their strongest monthly advances since April.
November’s rally was bolstered by positive vaccine news from several pharmaceutical companies. The developments pushed investors into stocks that hinge on a strong economic recovery.
Despite the positive vaccine data, Federal Reserve Chairman Jerome Powell called the economic outlook “extraordinarily uncertain” on Tuesday when he and Treasury Secretary Steven Mnuchin spoke before Congress this week as part of mandated updates on CARES Act funding. Mnuchin did call on Congress for $300 billion in aid for restaurants heading into the winter months.
Private payrolls data from ADP will be released at 8:15 a.m. ET on Wednesday. Economists polled by Dow Jones are expecting 475,000 private jobs were added in November, compared to the 365,000 added in October.
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