U.S. stock futures edged lower Friday as some investors grew concerned that President-elect Joe Biden’s $1.9 trillion Covid-19 relief plan could lead to higher taxes.
Futures tied to the S&P 500 fell 0.3%, indicating the benchmark index may decline for a second day. Contracts tied to the Nasdaq-100 edged less than 0.1% lower and those linked to the Dow Jones Industrial Average slipped 0.3%.
The S&P 500 is on track to end the week lower, erasing some of the gains made in early January when the gauge rallied to a record high. Markets have for weeks cheered Democrats’ plans to expand government spending and bolster the economic rebound. But the size of Mr. Biden’s plans, laid out late Thursday, served to check some of that optimism.
“The magnitude obviously was surprising on the upside,” said Wei Li, head of investment strategy for BlackRock ’s exchange-traded fund and index investments for Europe, Middle East and Africa. “With the Senate majority, [taxes] could be coming in the medium term and that is something the market has to assess as well.”
Investors are hoping that additional spending will help steer the U.S. economy through a winter that has seen high Covid-19 infection rates and worsening economic data. Figures released Thursday showed that the number of workers filing for jobless benefits posted its biggest weekly gain since the pandemic hit last March.