S&P 500 futures are flat after market hits record high, bank shares jump

U.S. stock index futures were quiet on Tuesday morning after the S&P 500 and Nasdaq Composite closed at record highs on Monday.

Futures contracts tied to the Dow Jones Industrial Average added 80 points. S&P 500 futures were little changed and Nasdaq 100 futures slipped by 0.2%.

Shares of Morgan Stanley jumped 3% in premarket trading after the bank said it will double its quarterly dividend. The bank also announced a $12 billion stock buy back program. The announcement follows last week’s stress tests by the Federal Reserve, which all 23 major banks passed.

Wells Fargo said it plans on doubling its dividend to 20 cents a share, subject to board approval and announced an $18 billion buyback plan. Bank of America, Goldman Sachs and JPMorgan also announced dividend increases.

Boeing shares rose nearly 1% in premarket trading after United said it was buying 200 Max planes.

Stocks rose to new highs during regular trading on Monday amid strength in Big Tech. The S&P 500 advanced 0.23%, registering its third straight record close. The Nasdaq gained nearly 1%, posting its fifth positive session in the last six, and also closed at a new high. The Dow, however, dipped 151 points amid a pullback in Boeing and Chevron, among other names.

With the market entering the final trading days of June and the second quarter, the S&P 500 is on track to register its fifth straight month of gains. The Nasdaq is pacing for its seventh positive month in the last eight. The Dow, however, is in the red for the month, and on track to snap a four-month winning streak.

The S&P 500 is up 14% and the Dow and Nasdaq are up 12% so far for 2021.

“Markets are off to a strong start this year,” LPL Financial chief market strategist Ryan Detrick said. “However, most of those gains came early in the year, and many stocks have stagnated over recent months,” he added. Detrick believes investors should stay overweight stocks relative to bonds, but pointed to some concerns in the market, including elevated valuations.

JPMorgan quantitative strategist Dubravkos Lakos-Bujas on CNBC’s “Squawk Box” that the market appeared to have near-term upside.

“The growth policy backdrop in our opinion still remains supportive for risk assets in general, certainly including equities. At the same time, the positioning is not really stretched to where we are in a problematic territory. So we do think there is still a runway. … The summer period, the next two months, is where I think the market continues to break out,” the strategist said.

Growth stocks continued to outperform on Monday, with the Russell 1000 growth metric rising nearly 1% while its value counterpart finished in the red. The value trade was outperforming for much of the year, but recently investors have rotated back into growth-oriented areas of the market. These stocks are up 6% for June, while value’s down more than 1%.

“The breakout to new highs in Growth was the catalyst to push the S&P 500 to new highs,” MKM Partners chief market technician JC O’Hara noted. “We see the situation where Growth may continue to outperform Value in the weeks ahead,” he said, based on technical analysis.

On the data front, investors will be watching for updated readings on home prices and consumer confidence on Tuesday morning.