Stock Market Today: Dow Futures Rebound Despite Infrastructure Bill Delay

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The stock market was trying to avoid starting October off the way it ended September after a vote on the $1 trillion infrastructure package was shelved Thursday night.

Futures for the

Dow Jones Industrial Average
were up 107 points, or 0.3%, after being down more than 200 points earlier Friday morning. Futures for the

S&P 500
were up 0.3%, while Nasdaq Composite futures were up 0.2%. . The Dow and the S&P 500 had their worst Septembers since 2011.

Thursday evening, House Democrats decided not to vote on the infrastructure bill, failing to agree on certain aspects of the bill.

While that doesn’t exactly help stocks, markets are looking ahead to a big batch economic data out Friday. Personal income and personal spending data hit the wires before the market opens, with economists expecting a month-over-month rise of 0.2% and 0.7%, respectively. Core inflation results will also come out, with expectations for a 0.2% increase, slower than the previous result of 0.3%.

Investors want to see that inflation is cooling, as the Federal Reserve has already signaled that an interest-rate increase in 2022 is now slightly more likely than it was before the Fed’s most recent update.

Overseas, in Asia, Japan’s

Nikkei 225
fell 2.3% as analysts noted traders in Tokyo were focused on events globally, with Chinese markets closed. The pan-European

Stoxx 600
was down 0.9%, as European stocks have found themselves under pressure from a strengthening

dollar
this week. The greenback has climbed 1.3% relative to the euro since Monday.

October was off to a bad start after the Dow saw its worst September since 2011, as markets fretted about a range of issues including central bank stimulus, inflation, supply-chain issues, a debt crisis in China, and a global energy crunch.

Many of those fears remained Friday, as a new month of trading began, with markets turning a keen eye to the $1 trillion infrastructure bill vote being shelved.

Plus: A Vote on Biden’s $1 Trillion Infrastructure Bill Was Delayed. Watch These Stocks.

The delay came amid debate among Congressional Democrats over the second part of Biden’s agenda—a hallmark $3.5 trillion budget reconciliation package addressing the U.S. social safety net and climate change initiatives.

“The issue is that some of the more progressive members among the House Democrats don’t want to vote for [the $1 trillion bill] without the larger reconciliation package, which contains much of Biden’s agenda on social programs,” said Jim Reid, a strategist at Deutsche Bank. 

“They fear that voting through the infrastructure bill will see moderates scale back the amount of spending on the reconciliation bill, so they’re using their votes on infrastructure as leverage,” Reid added.

Also read: House Delays Infrastructure Vote as Divisions Persist Among Democrats

Congress also faces the challenge of raising or suspending the U.S. debt ceiling before Oct. 18 to avoid a federal default.

Delaying the infrastructure bill vote came after a government shutdown was narrowly avoided, with Biden signing a stopgap bill funding the government through Dec. 3 just hours before funding expired.

“If it all looks like a mess, it is, and markets are reacting appropriately as nerves fray,” said Jeffrey Halley, an analyst at broker Oanda.

In commodity markets, futures for industrial metals fell, with contracts for aluminum, copper, zinc, and tin down 1.5% to 4.5%. The decline came after a report from Bloomberg that China’s Vice Premier, Han Zheng, ordered state-owned energy companies to secure energy supplies “at all costs” amid a power crunch in the country.

“It is probably a strong signal about how concerned China is regarding keeping industry going, and more importantly, the winter that is just around the corner,” Halley noted. “If Chinese steel and aluminium smelters are going to be shutting down for extended periods, you can be sure that will reverberate through global supply chains.”

Here are four stocks on the move Friday:

Universal Music Group

(UMG.Netherlands) rose 1.3% in Amsterdam after JPMorgan initiated stock coverage of the company, which went public last week, with a “buy” rating.

Airbus

(AIR.France) fell 1.5% in Paris despite news that Italian carrier ITA moved to lease 31 jets from the company and buy 28 more.

Vestas

(VWS.Denmark) fell 1.4% in Copenhagen despite winning a major order for an undisclosed wind project in Canada.

Merck

(MRK) rose 5% in the New York premarket after revealing positive trial data for a Covid-19 oral antiviral.

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