Nasdaq jumps 1.5%, S&P flirts with record

Industrials and materials may see infrastructure boost

U.S. equity markets ended mixed Wednesday as details of President Biden’s $2 trillion infrastructure package were released on the final day of the first quarter.

Ticker Security Last Change Change %
I:DJI DOW JONES AVERAGES 33942.23 +211.34 +0.63%
SP500 S&P 500 4153.86 +29.20 +0.71%
I:COMP n.a. n.a. n.a. n.a.

The Dow Jones Industrial Average slipped 85 points, or 0.25%, while the S&P 500 and the Nasdaq Composite climbed 0.37% and 1.54%, respectively.

The Biden administration says its so-called American Jobs Plan will be a “once-in-a-century capital investment” in U.S. infrastructure that will create millions of good-paying jobs that positions America to  “out-compete” China.

Bank of America notes the biggest beneficiaries will likely be industrial and material stocks. Tesla also rallied as electric-vehicle makers are expected to benefit.

Ticker Security Last Change Change %
XLI INDUSTRIAL SELECT SECTOR SPDR ETF 100.23 -0.29 -0.29%
XLB MATERIALS SELECT SECTOR SPDR ETF 80.90 +0.22 +0.27%
TSLA TESLA, INC. 725.73 -6.50 -0.89%

The $2 trillion plan will be entirely funded by Biden’s proposed Made in America Tax plan that would hike the corporate tax rate to 28%, up from 21%, and increase the minimum tax on multinational corporations to 21%. The increase in the corporate tax rate would partially undo former President Donald Trump’s tax cut which lowered the top corporate rate from 35%, among the highest in the world.

Biden will officially unveil the plan at a speech in Pittsburgh later on Wednesday.

BIDEN’S $2T INFRASTRUCTURE PLAN TO BE FUNDED BY CORPORATE TAX HIKE PROPOSAL

In stocks, Pfizer Inc. and BioNTech SE said their COVID-19 vaccine was safe and effective for children as young as 12 years old. A statement released by Pfizer CEO Albert Bourla said his company hopes doses can be given before the next school year.

Ticker Security Last Change Change %
PFE PFIZER INC. 37.49 +0.30 +0.81%
BNTX BIONTECH SE 135.49 +2.89 +2.18%

Swiss lender Credit Suisse had its credit outlook cut to negative at S&P Global Ratings due to its exposure to the unwinding of billions of dollars of positions by the hedge fund Archegos Capital Management.

Ticker Security Last Change Change %
CS CREDIT SUISSE GROUP AG 10.62 -0.01 -0.14%

Boeing Co. and Alaska Airlines Group Inc. finalized an agreement in which the latter would buy an additional 23 737 MAX 9 jets that will be delivered between 2023 and 2024. The deal gives Alaska Airlines an option to purchase an additional 15 aircraft with deliveries occurring between 2023 and 2025.

Ticker Security Last Change Change %
BA THE BOEING CO. 251.92 -0.31 -0.12%
ALK ALASKA AIR GROUP 69.05 -1.45 -2.06%

In earnings, Walgreens Boots Alliance Inc. reported its quarterly profit rose 8.4% from a year ago, helped by improved sales at its U.S. pharmacies. The company also raised its 2021 adjusted earnings per share forecast to mid-to-high single-digit growth.

Ticker Security Last Change Change %
WBA WALGREENS BOOTS ALLIANCE, INC. 54.28 -0.19 -0.35%

Meanwhile, steel manufacturer Cleveland-Cliffs Inc. outperformed after guiding both first-quarter and full-year adjusted EBITDA above estimates. The announcement also boosted rival U.S. Steel Corp.

Ticker Security Last Change Change %
CLF CLEVELAND-CLIFFS INC. 18.15 -0.38 -2.04%
X UNITED STATES STEEL CORPORATION 22.35 -0.51 -2.23%

In commodities, West Texas Intermediate crude oil fell $1.39 to $59.16 per barrel and gold ticked up $29.90 to $1,713.80 an ounce.

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Overseas markets were lower across the board.

Britain's FTSE 100 paced the decline in Europe, trading down 0.86% while France's CAC 40 fell 0.34% and Germany’s DAX 30 was unchanged

In Asia, Japan’s Nikkei 225 lost 0.86%, Hong Kong’s Hang Seng index retreated 0.7% and China’s Shanghai Composite index slumped 0.43%.