US inventory futures fell barely after the post-election rally
Traders work on the floor of the New York Stock Exchange on November 4th. 2020.
US stock futures fell slightly on Thursday night as Wall Street looked at its best week since April, although the presidential election results remained unclear.
Futures linked to the Dow Jones Industrial Average lost around 80 points, while those for the S&P 500 and Nasdaq 100 fell around 0.3% and 0.7%, respectively.
The three indices hit their fourth consecutive positive session on Thursday and were on their way to their best week since April 9th. The S&P 500 and Dow are up 7% so far this week. The tech-heavy Nasdaq Composite has the edge with a plus of almost 9%. The sharp rally follows a slump in the previous week.
The rise in stocks has occurred despite ongoing uncertainty about the outcome of Tuesday's election. Democratic candidate Joe Biden leads with 253 votes, according to NBC News forecasts, while President Donald Trump has 214 votes. Votes are still counted in several key states, including Nevada, Arizona, Pennsylvania, and Georgia.
Republican victories in several key Senate races that lower the likelihood of a "blue wave" and potentially higher taxes and stricter regulations have been cited by Wall Street strategists as the reason technology stocks rally. However, according to NBC News forecasts, with two possible runoff elections in Georgia, the Republicans have not yet won the seats necessary to control the Senate.
Alicia Levine, chief strategist at BNY Mellon Investment Management, said the possibility that Democrats gain tight control over the Senate is one of the biggest risks that would not be priced into the market, even if the outflows didn't necessarily lead to a decline in the market Markets.
"The market is now factoring in a Biden presidency with a Republican Senate, and the rotation we saw was based on that," Levine said. "And if the risk increases that this is not the case for the Senate, this entire move could also pose some risk."
Levine also said the strength of tech stocks was due in part to their strong earnings performance and resilience in the event of new economic restraints in the United States over the winter to slow the spread of the coronavirus.
Republicans have filed a number of legal challenges in several states related to the running vote, and the Trump campaign said it would request a recount in Wisconsin.
In a White House announcement on Thursday evening, Trump falsely claimed victory in multiple states and alleged election fraud without evidence. "There has been a tremendous amount of litigation in general because the process was unfair."
The Biden campaign has now demanded that all votes be counted.
"Democracy is sometimes chaotic. Sometimes it also takes a little patience," said the former vice president in a brief speech in Delaware on Thursday, adding that he was confident that his ticket would be declared the winner once all the votes were counted.
In economic terms, Friday will take a fresh look at the investor labor market. The job vacancies from the Ministry of Labor in October are due to be published before the bell. The report follows disappointing readings for private ADP payrolls and initial jobless claims.