U.S. stock futures climbed early Tuesday in relief over the Trump administration’s move to begin the transition process.
Futures on the Dow Jones Industrial Average rose 308 points, or 1%. S&P 500 futures gained 0.8% and Nasdaq 100 futures added 0.3%.
The move higher in futures came after General Services Administration chief Emily Murphy told President-elect Joe Biden that the Trump administration is making federal resources available for his transition into office.
Trump tweeted that he approved of the move, but said he will “keep up the good fight” even as his reelection campaign has so far failed to win any legal victories that would invalidate votes for Biden.
Stocks kicked off the Thanksgiving week on a high note on Monday as investors piled into reopening trades amid vaccine optimism. The Dow rose more than 300 points for its best day in a week, while the S&P 500 climbed 0.6%. The tech-heavy Nasdaq Composite underperformed with just a 0.2% gain.
The small-cap Russell 2000 jumped 1.9% to another record high amid the rotation into beaten-down companies.
Investors cheered more promising developments on the Covid-19 vaccine front. AstraZeneca said interim analysis showed its vaccine has an average efficacy of 70%, following strong results from Pfizer-BioNTech and Moderna.
Major averages hit their session highs after news broke that Joe Biden will nominate former Federal Reserve Chair Janet Yellen to be Treasury Secretary. Many view Yellen as a market-friendly pick considering that she oversaw a long economic expansion with historically low-interest rates and she’s likely to push for further fiscal stimulus.
“I think this is a strong sign that Biden will be focused on rebuilding the economy vs. pursuing aggressive regulatory policy,” said Ed Mills, Washington policy analyst at Raymond James. “She will be an effective voice of more fiscal support vs. someone who was seen as a partisan … I would say that is a positive development for the market, but more importantly for the economy as a whole.”
Still, investors weighed vaccine news against a resurgence in new coronavirus cases, which prompted some Wall Street firms including Goldman Sachs and JPMorgan to lower their near-term economic outlook.
The U.S. continues to notch record Covid-19 infections, with the national seven-day average of daily new cases hitting 170,855 on Sunday, according to a CNBC analysis of Johns Hopkins University data.
Investors will monitor a slew of earnings from retailers ahead of the holiday season, including Best Buy and Dick’s Sporting Goods before the bell as well as Gap and Nordstrom after the close Tuesday.
U.S. markets will be closed for the Thanksgiving holiday on Thursday and will have a short session on Friday.
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