Stock futures nudge higher after S&P 500 suffers first negative start to a year since 2016

Stock futures nudged higher in early morning trading on Tuesday after the S&P 500 suffered its first decline to start a year since 2016. Futures on the Dow Jones Industrial Average rose 85 points. S&P 500 futures and Nasdaq 100 futures were also both slightly higher.

The moves in futures came after a sharp sell-off on Wall Street to kick off 2021. The S&P 500 fell 1.5%, posting its worst daily performance since Oct. 27. Ten out of 11 S&P 500 sectors registered losses, led by real estate. The blue-chip Dow shed 382 points after tumbling as much as 700 points at its low of the day. The Nasdaq Composite declined 1.4% as the FAANG block all slumped to start the new year.

The broad market sell-off occurred ahead of Tuesday’s Georgia runoff elections, which will determine whether Republicans can hold on to control in the Senate. Meanwhile, rising Covid-19 cases globally and new lockdown restrictions continued to keep investors on edge.

Many fear that increased tax rates and more progressive policies could become reality if Democrats gain control of the Senate. However, such an outcome could create an opportunity for a bigger and faster spending package, which will help support the market.

On Monday, England imposed a third coronavirus lockdown as the region grapples with a more transmissible variant of Covid-19. New York state has confirmed its first case of the new strain, Gov. Andrew Cuomo said Monday.

Stock futures nudge higher after S&P 500 suffers first negative start to a year since 2016, CNBC, Jan 5