U.S. stock futures were higher in early morning trading on Tuesday after the Dow Jones Industrial Average and S&P 500 notched new record closes on the first trading day of 2022.
Dow futures rose 134 points or about 0.4%. S&P 500 and Nasdaq 100 futures also gained 0.4% apiece.
Energy and economic recovery stocks were among the early gainers, despite omicron cases rising above 1 million Monday as the virus continues to storm across the country.
Halliburton shares rose 2.1% in premarket trading as crude prices rose and Morgan Stanley upgraded the oil services company.
Investors this week have been betting the economy could overcome the latest surge in Covid cases and the riding momentum from what was a stellar 2021 for the markets.
“We believe there is further upside for stocks, despite a strong run so far,” wrote JPMorgan equity strategists led by Mislav Matejka in a note Tuesday. “The new variant is proving to be milder than the prior ones.”
“We continue to see gains for earnings, and believe that consensus projections for 2022 will again prove too low,” they added.
Elsewhere, cruise operators continued their rebound, with Carnival shares up 2.8%, Norwegian Cruise rising 2.2% and Royal Caribbean gaining 2.1%. MGM Resorts also posted a 1.8% gain and Alaska Air rose 1.6% as part of the reopening trade.
Apple shares were also up premarket, rising another 0.7% a day after the company briefly became the first to achieve a $3 trillion market cap.
On Monday, the major averages rose, lifted by the technology sector. The Dow Jones Industrial Average added 246 points to close at a record. The S&P 500 also registered a gain, climbing 0.6% to close at an all-time high.
The Nasdaq Composite was the relative outperformer, gaining 1.2% as Meta Platforms, Amazon and Google-parent Alphabet all closed in the green.
Tesla added 13.5% after the firm beat fourth-quarter and full-year delivery expectations.
Reopening plays like airlines and cruise lines also rose on Monday. A jump in bond yields lifted bank stocks.
“Optimism on global economic growth and earnings momentum reviving since mid-December continued to grow in the first day of the New Year,” said Jim Paulsen, Leuthold Group chief investment strategist. “Those stocks most closely tied to better economic growth did the best [Monday] but were joined by new-era sectors including technology and communications.”
On Tuesday, November’s Job Openings and Labor Turnover Survey will be released at 10 a.m. The JOLTS report is closely watched at the Federal Reserve and elsewhere for signs of labor market tightness.
December’s ISM manufacturing PMI is also set to release Tuesday morning.
Monday’s records moves come after markets closed out a strong 2021 last week. The S&P 500 rose nearly 27% for the year, with the Nasdaq Composite and Dow also posting strong gains.
“The well-known Santa Claus Rally ends on Tuesday. The good news is stocks look like they’ll be higher during these bullish 7 days,” said Ryan Detrick of LPL Financial. “It is when these days have been down when we need to worry, so that’s one less worry at least.”
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The Dow Jones Industrial Average and S&P 500 closed at records on Monday.