US stocks close at record highs as traders weigh recovery optimism against valuation concerns
- US stocks closed at record highs on Friday as investors mulled how much further the market could climb.
- Optimism around vaccinations and new stimulus continue to offset weak jobs data.
- Bitcoin traded around $47,500 after notching a record high late Thursday. Adoption from BNY Mellon, Mastercard, and Tesla sent prices soaring through the week.
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US stocks closed at all-time highs on Friday as the month's rally charged on.
Momentum from Thursday's session continued, as investors weighed whether stocks have room to move higher. While Democrats are pushing forward with a $1.9 trillion relief package, stretched valuations and lasting pain in the labor market stand to curb further gains.
"Investors have been bracing for a selloff as stocks continue to defy gravity," Lindsay Bell, chief investment strategist at Ally Invest, said. "While stocks may look stretched and feel ripe for a selloff, it is best to prepare your portfolio for the potential of both more upside and downside."
Here's where US indexes stood at the 4 p.m. ET close on Friday:
- S&P 500: 3,934.99, up 0.48%
- Dow Jones Industrial Average: 31,458.99, up 0.09% (28.29 points)
- Nasdaq composite: 14,095.47, up 0.5%
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The emergence of new COVID-19 strains threatens optimism around an improving pace of vaccination. The US administered 1.62 million doses per day on average last week, bringing the nationwide total to 48 million vaccinations. President Joe Biden announced Thursday the drive will accelerate further still, with the US completing orders for 100 million additional doses from Pfizer and Moderna.
Public health experts have warned the shots are less effective against new strains of COVID-19, hampering forecasts for a complete elimination of the virus.
Coronavirus case counts suggest that, so far, the strains aren't plunging US into another wave of infections. The country reported 103,024 new cases on Thursday, down significantly from levels seen just one month ago. Hospitalizations declined further to 74,225, according to The COVID Tracking Project.
Energy and material stocks outperformed through the session. The utilities and real estate sectors lagged.
Earnings season continued. Disney gained after reporting earnings and revenue above Wall Street's expectations. Subscribers for its Disney Plus streaming service neared 95 million even as a free-trial deal with Verizon customers ended, the company said.
Bumble gained again after soaring 64% in its Thursday trading debut. The dating app raised $2.2 billion on Wednesday offering 50 million shares for $43 each. The post-IPO pop suggests demand for new offerings will remain strong in 2021.
Coherent climbed after electronic-parts manufacturer II-VI Incorporated bid $260 per share to acquire the company. Coherent has been at the center of a bidding war in recent weeks that also includes Lumentum and MKS Instruments.
Electric-vehicle company Fisker soared after Morgan Stanley analysts deemed the firm one of the "most compelling strategies and positive risk-reward skews" in the sector. The bank initiated coverage on the company with an "overweight" rating.
Bitcoin stabilized around $47,500 after falling from a record-high of 48,925.53 Thursday night. Backing from industry giants including Tesla and BNY Mellon has reinvigorated the cryptocurrency and lifted prices throughout the week.
Spot gold edged as much as 0.81% lower, to $1,810.67 per ounce. The US dollar strengthened against a basket of Group-of-20 currency peers and Treasury yields climbed.
Oil prices erased early losses and climbed into the afternoon. West Texas Intermediate crude rose as much as 2.7%, to $59.82 per barrel. Brent crude, oil's international benchmark, gained 2.8%, to $62.83 per barrel, at intraday lows.