U.S. markets and stock exchange traded funds jumped Tuesday as traders wait on earnings from tech giants Amazon and Google’s parent Alphabet, along with updates on the next installment of a coronavirus relief package.
On Tuesday, the Invesco QQQ Trust (NASDAQ: QQQ) rose 1.9%, SPDR Dow Jones Industrial Average ETF (NYSEArca: DIA) was up 1.9%, and iShares Core S&P 500 ETF (NYSEArca: IVV) gained 1.7%.
Amazon and Google will report fourth quarter earnings after the markets close, and they were among the top performers in the S&P 500.
“There’s no reason to think that the strength of earnings on the part of big tech is likely to diminish until perhaps later in the year and certainly the fourth quarter was likely to be a good one,” Julian Emanuel, chief equity and derivatives strategist at BTIG, told Reuters.
The earnings season has been better than anticipated. Of the 189 companies on the S&P 500 index that had reported results, 81% beat expectations, according to FactSet data.
The Democratic-led U.S. House of Representatives took the initial steps to pass through President Joe Biden’s proposed $1.9 trillion COVID-19 relief package Tuesday.
The U.S. continues to fight against Covid-19 infections, which have dipped for a third week in a row, the first time since September.
“Investors are going back to the script of strong earnings growth … and expectations of an economic reopening, as the vaccine get more widely distributed and all of those point to the continuation of the markets upward trend,” Emanuel added.
Meanwhile, the number of people who have received a COVID-19 vaccine will soon pair the total infections across the country, according to U.S. CDC data.
“The vaccine rollout is continuing to pick up steam, it looks like, for at least the time being, the [coronavirus]surge isn’t just continuing, and the earnings have been good,” Tim Courtney, chief investment officer of Exencial Wealth Advisors, told the Wall Street Journal. “So in terms of what the markets wanted to see, it’s pretty much gotten the news it wanted so far.”
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