US Stock Market: Infrastructure Deal Puts Dow in Focus, Banks in Play Following Successful Stress Tests

The major U.S. stock indexes are trading higher during the premarket session on Friday following another record performance by the S&P 500 Index the previous session. The indexes are being bolstered by a number of events including robust earnings reports, impressive bank stress test results and the news that the White House struck an infrastructure deal with a bipartisan group of senators.

At 07:43 GMT, September E-mini S&P 500 Index futures are trading 4257.75, up 1.75 or +0.04%. September E-mini Dow Jones Industrial Average futures are at 34171, up 89 or +0.26% and September NASDAQ-100 Index futures are trading 14361.00, up 6.75 or +0.05%.

Looking ahead, the Commerce Department is set to release May’s core personal consumption expenditures (PCE) index at 12:30 GMT. Economists polled by Dow Jones expected prices rose 3.4% in May from a year earlier. Economists also estimate prices increased by 0.6% from April to May.

Nike Earnings Beat Estimates

Nike’s stock rose nearly 5% in extended trading after the company reported earnings of 93 cents per share, outpacing a Refinitiv estimate by 42 cents per share. Revenue came in at $12.34 billion, topping a forecast of $11.01 billion. Digital sales were up 41% since last year and 147% from two years ago.

Bank Shares Rise after Fed Announces Stress Test Results

Shares of major U.S. banks are up after the Federal Reserve announced the banks could easily withstand a severe recession. The Fed, in releasing the results of its annual stress test, said the 23 institutions in the 2021 exam remained “well above” minimum required capital levels during a hypothetical economic downturn. Bank of America and Wells Fargo rose 1.8% and 2.7%, respectively, CNBC reported.

White House Announces Infrastructure Deal

President Joe Biden declared Thursday that the White House has struck an infrastructure deal with a bipartisan group of senators after discussing the massive plan to improve the nation’s roads, bridges and broadband earlier in the day.

Thursday Recap

The benchmark S&P 500 and the tech-heavy NASDAQ Composite Indexes hit all-time highs on Thursday, with the Dow also jumping.

In economic news, the Commerce Department said the economy grew at a 6.4% rate last quarter, unrevised from the estimate published in May. Additionally, initial claims for state unemployment benefits fell 7,000 to 411,000 for the week ended June 19, the Labor Department said on Thursday, but were still higher than the 380,000 that economists had forecast.

Stocks in Play

Tesla Inc rose 5% after Chief Executive Officer Elon Musk said he would list SpaceX’s space internet venture, Starlink, which its cash flow is reasonably predictable, adding that Tesla shareholders could get preference in investing.

Mega-caps Microsoft Corp, Netflix Inc and Facebook Inc gained between 0.4% and 1.3% and were among the biggest boosts on the S&P 500 and the NASDAQ.

Caterpillar jumped 3.4% and Boeing rallied 2.2%, helping lift the Dow Jones Industrial Average.