Stocks are back in record territory again

By CNN Business

Updated 7:07 p.m. ET, February 10, 2021
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5:23 p.m. ET, February 10, 2021

Dow climbs to new record high

From CNN Business' Anneken Tappe

US stocks finished mixed on Wednesday but the Dow managed to eke out a fresh all-time high thanks to a few strong gainers. Walgreens (WBA), which will soon offer the Covid-19 vaccine, was the best performer in the index.

The Dow finished up 0.2%, or 62 points, putting it at a new record high.

The S&P 500 ended flat.

The Nasdaq Composite slipped 0.3%.

2:38 p.m. ET, February 10, 2021

Don't worry about the deficit now, Powell says

From CNN Business' Anneken Tappe

Washington is spending trillions to get the nation through the pandemic -- and get the economy back on track. Deficit hawks are really worried about what this could mean for America's debt pile.

They're right to worry, but this just isn't the time for those concerns, said Federal Reserve Chairman Jerome Powell during a virtual event with the Economic Club of New York.

"The US deficit is not on a sustainable path," Powell said, but that's not new and has been the case for a while now.

Still, this is not a time to be stingy with government spending, the central banker said:

That time is when the economy is strong, unemployment is low, taxes are rolling in. That time will come."

Interest rates are at ultra-low levels, which makes incurring new debt very cheap for the United States. Some worry that this will change when interest rates go up. But again, Powell tried to soothe these worries.

"We're a long way from a situation where we would have to take into account how the federal government should finance itself," he said.

2:38 p.m. ET, February 10, 2021

Powell: More stimulus is needed. Stop worrying about inflation shooting up

From CNN Business' Anneken Tappe

Fed Chair Jerome Powell wants more government stimulus. That's not secret. But what does he make of the discussions in Washington about President Joe Biden's proposed stimulus plan?

"The question how much to spend and what to spend it on is a question for Congress," Powell said, sticking with his a-political line. The Fed is an independent institution, so his reticence makes sense.

But what about monetary stimulus?

Some Fed watchers are getting worried that the current, ultra-loose monetary policy will lead to a spike in inflation, but Powell is less worried about that.

Inflation trends have been pretty low for years in the United States. In fact, only a few years ago, central bankers around the world were scratching their heads about why inflation remains so low.

So even if consumers suddenly spend all their saved up money when the economy reopens fully, which could push prices higher, "my expectation would be that that would be neither large nor sustained," Powell said.

2:30 p.m. ET, February 10, 2021

Powell: 'We are still very far from a strong labor market'

From CNN Business' Anneken Tappe

We're a long road away from a labor market that delivers substantial economic and social benefits, such as higher employment and income levels, Federal Reserve Chairman Jerome Powell said during a virtual speech at the Economic Club of New York.

We are still very far from a strong labor market," Powell said.

To get the labor market back on its feet, it will take "continued support from both near-term policy and longer-run investments," Powell said, reiterating his call for further government support of the economy.

Government initiatives such as the Paycheck Protection Program can be credited for limiting permanent job losses, which as of January were considerably lower than during the Great Recession, Powell said.

Right before the pandemic hit, the US unemployment rate was at near a 50-year low of 3.5% and even though wages were growing slowly, they were growing faster for workers on the lower end of the income spectrum. But all that is lost now.

Making matters worse, economic disparities that were "already too wide" have widened further, Powell said in his speech, citing that employment for earners in the top quartile of wages has been only 4%, while the decline for the bottom quartile has been a staggering 17%.

1:17 p.m. ET, February 10, 2021

Don't forget to adjust your portfolio for the recovery

From CNN Business' Anneken Tappe

The pandemic has made stay-at-home stocks like Zoom (ZM), Amazon (AMZN) and Netflix (NFLX) into fan favorites. But what paid off in 2020 might not be the right mix in 2021.

"What worked last year was really the virtual world," said Gabriela Santos, global market strategist at JPMorgan (JPM) Asset Management on the CNN Business digital live show Markets Now. Investors should think about how to balance their portfolios with cyclical stocks in 2021.

"This year it will be important to pivot a bit to the real world," she added. This could include adding stocks from the industrial sector to portfolios, she said.

1:14 p.m. ET, February 10, 2021

As most retail floundered, flower sales increased during the pandemic

From CNN Business' Anneken Tappe

The pandemic isn't over and showing your loved ones you are thinking of them has changed. For example, people are sending more presents and flowers.

That's good news for companies like Farmgirl Flowers, which finished 2020 with 100% revenue growth as it adapted to the pandemic way of life. With Valentine's Day coming up this weekend, flower orders are still pouring in for the company.

But a year ago, it wasn't clear that would be the case. "It was actually the most challenging year of my life personally and professionally," Christina Stembel, founder and CEO of Farmgirl Flowers, told Alison Kosik on the CNN Business digital live show Markets Now. "Our sales went down about 85% in the first week after shelter in place went into effect," adding that sales skyrocketed back came back up within weeks.

"We moved our location from San Francisco to a more agricultural community" after the pandemic hit, she said, and the company opened distribution centers to meet its demand for Mother's Day last May.  

Once vaccines are widely distributed, Stembel said her business will likely change again. "People will be spending more time with the people they love," she said, and she expects some lower revenue months. But, she added, "we're creating products lines at all product price points."

12:53 p.m. ET, February 10, 2021

'I think we're a little bit in a bubble,' investor says

From CNN Business' Anneken Tappe

US stock indexes are in the red today, but on the whole the market is still near record highs. The Nasdaq Composite last set an all-time high yesterday, and bubble talk is getting louder.

"I think we're a little bit in a bubble. I think valuations are stretched," said Kenny Polcari, managing partner at Kace Capital Advisors, on the CNN Business digital live show Markets Now.

Polcari has expected a pullback in stocks since the start of the year, but the market keeps escaping a correction because investors have a fear-of-missing-out on the stocks rally.

An event that the market isn't necessarily expecting could finally knock the market off its highs, Polcari said, perhaps even by a smaller-than-expected stimulus package.

Even so, the investor doesn't predict a huge selloff, but rather a 5-7% correction that "takes some of the fluff out of the market," Polcari said.

11:49 a.m. ET, February 10, 2021

Stocks lose steam

From CNN Business' Anneken Tappe

It's nearly midday and US stocks aren't looking so good.

The major three stock indexes have pulled back from their initial gains and now are in the red. The Nasdaq Composite, which was on track for yet another record high earlier in the day, is leading losses, falling 0.4%.

The S&P 500, the broadest measure of Wall Street, is down 0.2%, and the Dow is down a modest 0.1%, or 19 points.

Consumer and tech stocks are among the biggest losers around midday.

11:35 a.m. ET, February 10, 2021

Economists predict another 757,000 initial jobless claims tomorrow

From CNN Business' Anneken Tappe

Claims for unemployment benefits just won't budge. Sure, they have come down from their initial highs at the start of the pandemic crisis, but they still hover around levels four-times as high as before Covid-19. America's jobs recovery doesn't look so hot.

For tomorrow's release, economists predict another 757,000 claims for first-time jobless benefits. And that doesn't include people filing for Pandemic Unemployment Assistance, which is available for gig workers and the self-employed. It would be a slight improvement from last week's report, which cited 779,000 claimants.

Continued claims, which count people who filed for at least two weeks of benefits in a row, are expected to tick down to 4.5 million, compared with 4.6 million before. Any improvement is good news, but the pace here is really like trickle.

The Department of Labor will publish the weekly jobless claims report tomorrow morning at 8:30 am ET.