US futures trade mixed after stocks hit record highs, while bitcoin continues to slide

Wall Street New York Stock Exchange
A strong earnings season has boosted optimism on Wall Street. JOHANNES EISELE/Getty Images
  • US futures were trading mixed on Friday, after stocks rose to close at record highs the prior day.
  • Equities have stayed remarkably strong despite soaring inflation, with economic data lifting investors’ spirits.
  • Yet cryptocurrencies have taken a tumble in recent days, after a breakneck rally.

US stock futures were mixed Friday after the S&P 500 and Nasdaq hit record highs the previous day, as investors became more optimistic about the economic outlook.

Elsewhere, however, bitcoin fell for the fifth day in a row. It traded at around $US56,878 ($AU78,296), well below a record high of above $US68,000 ($AU93,606) touched just over a week ago.

S&P 500 futures fell 0.1%, and Dow Jones futures slipped 0.33%, signaling a downbeat start to trading later in the day. Meanwhile, Nasdaq 100 futures were 0.35% higher.

The S&P 500 and the Nasdaq finished at new highs Thursday, as corporate earnings continued to impress investors and a fall in weekly jobless claims cooled fears about the US economy.

Overnight, China’s CSI 300 closed 1.08% higher, while Japan’s Nikkei 225 climbed 0.5%. In the early going Friday, Europe’s continent-wide Stoxx 600 slipped 0.14%.

COVID-19 cases are surging in Europe, and Austria said Friday it will go into full lockdown on Monday and introduce compulsory vaccinations. The news has put regional stocks “on the back foot,” strategists at broker IG said in a daily note.

“With COVID cases turning upwards across the likes of Germany, France, and Portugal, there is a fear that today’s announcement is indicative of where other European nations could find themselves in 2-3 weeks’ time,” they added.

Global stocks have remained buoyant despite investors’ worries about inflation and the likelihood of central banks cutting back their support for economies soon. Partly it’s because bond yields have stayed low, making the equity market more attractive.

Earnings season has helped support US stocks in particular. Nvidia on Thursday jumped 8.25% after posting record revenue, while Macy’s and Kohl’s rose after the department store chains released strong earnings.

New US jobless claims fell to a pandemic low of 268,000 last week, data showed Thursday, in the latest sign that the economic recovery is broadly on track.

Investors will be keeping a close eye on Washington, where the House is expected to pass President Joe Biden’s “Build Back Better” bill later Friday. It lays out plans to spend $US1 ($AU1).85 ($AU3) trillion on education, healthcare and the climate.

Also in focus is Biden’s choice for leader of the Federal Reserve — whether to keep Jerome Powell as Fed chair or to replace him with Fed Governor Lael Brainard. Earlier this week, Biden said he could announce the decision by Friday.

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Cryptocurrencies continued to slide Friday, with bitcoin down 4.4% to $US56,878 ($AU78,296) on the Bitstamp exchange. The world’s biggest cryptocurrency has fallen around 17% from its November 10 record high.

Analysts have credited the decline to factors such as the crypto tax rules in Biden’s $US1 ($AU1) trillion infrastructure bill and a recent warning from Beijing about crypto mining in China. Some suggest it’s a natural pullback after the token surged to new heights.

Other cryptocurrencies — such as ether, binance coin, and solana — have slumped in recent days, but were paring those losses Friday.

Oil prices fell as the coronavirus surge in Europe raised concerns about economic recovery and as traders weighed the chances of countries releasing strategic reserves. Brent crude was down 1.83% to $US79.77 ($AU110) a barrel, while WTI crude was 1.7% lower at $US77.12 ($AU106) a barrel.

Bond yields slipped, with the yield on the key 10-year US Treasury note down 2.9 basis points to 1.558%. Yields move inversely to prices.