After the S&P 500 posted its highest week since February and a new record on Friday, futures contracts linked to major U.S. stock indices were up at the beginning of the overnight session Sunday night.Futures linked to the S&P 500 advanced 0.1%, while those tied to the Dow Jones Industrial Average gained 47 points. Futures on Nasdaq 100 traded at the flatline.Stocks recorded their best week since months, as investors became more comfortable with inflation. They saw the current price acceleration in U.S. as not a permanent economic threat but as a temporary one.Friday's close saw the S&P 500 reach a record high of 4,280.70. The Dow rose 237.02 points to finish less than 2% off its record. The Nasdaq Composite closed slightly lower Friday but gained 2.35% for week, its highest since April 9, and is up 4.45% in June.Even though the Commerce Department reported that its inflation index rose 3.4% in May (the fastest increase since early 1990s), the weekly gains were still impressive.Investors can feel heartburn if there are spikes in the core personal consume expenditures price index. The Federal Reserve is keen to monitor it for signs that inflation is occurring. The rise was actually lower than what Dow Jones economists had predicted and reinforced investors' belief that price increases across the economy will be temporary and manageable.The Labor Department will publish the next important piece of economic data on Friday, the June jobs report.Economists expect that nonfarm payrolls will rise by 683,000 in June. Although this would be a strong reading, it would still not reach the 1,000,000 that economists had hoped the recovering U.S. would post after the Covid-19 crisis.Investors will also examine the June report to see if there are any signs of wage inflation, as employers struggle for workers to fill job vacancies and some states' pandemic-era benefits drop in value.After President Joe Biden on Saturday clarified that he does not plan to veto the legislation, if it isn't accompanied by a separate reconciliation bill which was favored by Democrats, a massive bipartisan infrastructure agreement appeared to be revived on Sunday evening.On Thursday, the president was flanked by bipartisan senators who announced that they had reached a multibillion dollar deal to improve America's roads and bridges, waterways, and broadband. This agreement came after weeks of negotiations. Democrats are pushing for a second bill to include funding for issues such as climate change, child-care, and education.
