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Following two huge days of gains, stocks may take a breather today.
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Before the bell Tuesday, Dow Jones industrial average futures fell more than 100 points, whereas the S&P 500 declined by about 10 points and the Nasdaq shed 25 points.
This follows a day that saw the Dow surge more than 400 points. Shares of equipment makers and steel producers rallied after the Trump administration rolled out a $1.5 trillion plan to boost spending on infrastructure.
“The size of the deficits has surprised the markets but they are more worried about increased government spending and tax cuts overstimulating the economy,” said Mark Vitner, Managing Director & Senior Economist at Wells Fargo Securities.
Caterpillar (CAT) rose 2.1%, while U.S. Steel (X) jumped 5.8%. Other top gainers included Deere (DE), AK Steel Holding (AKS) and U.S. Concrete (USCR), companies that stand to benefit from increased infrastructure spending.
In Europe, London’s FTSE, France’s CAC and Germany’s DAX all traded lower.
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“European markets are back in familiar negative territory,after yesterday’s rebound in stocks failed to carry through into a second session,” said Joshua Mahony, Market Analyst at IG.
“While today’s losses are relatively minimal, it is the precedent thatis being set which carries more weight, for given the size of last week’s losses, the bulls would be hoping to see a significantly more forthright and constant upward pressure”, Mahony added.
The U.S. rally carried over to Asian markets where stocks came off two-month lows.
Hong Kong’s Hang Seng index was up 379.90 points or 1.29 percent at 29,839.53.
South Korea’s KOSPI climbed 0.65 percent. China’s Shanghai Composite was 1 percent higher.
Japan’s Nikkei returned from Monday’s holiday to start the day higher, but lost steam to end 0.7 percent lower at 21,244.68 points, its lowest closing level since mid-October.
The 10-year Treasury yield trimmed back to 2.849 percent after rising to a four-year peak of 2.902 percent on Monday.