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Stock indices were trading higher early Friday, as investors looked to end a week on Wall Street that was mostly framed by optimism about the outlook for COVID-19 vaccines and treatments, while eclipsing a peak of the viral epidemic in the United States and Europe. .
Markets remain sensitive to talk about the possibility of another tax aid package that could help workers and businesses, despite a lack of political momentum to reach a pact in the aftermath of a controversial US presidential election.
How are stock market indices performing?
The Dow Jones Industrial Average DJIA,
traded 156 points, or 0.5%, to reach around 29,235, while the S&P 500 SPX index,
gained 20 points to reach 3557, a gain of 0.6%, while the Nasdaq Composite Index COMP,
NQZ20,
climbed 34 points, a gain of 0.3%, to around 11,746.
For the week so far, the Dow Jones is up 3.3%, the S&P 500 Index is looking at a gain of 1.4%, while the Nasdaq Composite Index COMP,
is on track for a weekly decline of 1.3%.
What drives the stock market?
On Friday the 13th, US stock indices were expected to rise despite a number of factors that would otherwise scare investors.
Hope for COVID-19 vaccines has pushed most stock benchmarks to a second consecutive weekly gain, but questions remain about the outlook as parts of the world face new lockdowns to deal with a further spread of the virus.
“Despite all the optimism about the delivery of a successful vaccine, the reality is that the announcement of a possible candidate has never been able to put an end to what is currently happening in Europe, as well as ‘in the United States, in terms of a sharp increase in coronavirus infection rates, hospitalizations and ultimately a sharp rise in death rates, ”wrote Michael Hewson, chief market analyst at CMC Markets UK in a note.
Lily: The market is now more vulnerable to bad news, believes this strategist. Here is what he says comes next
The United States set a record Thursday for coronavirus hospitalizations of more than 67,000 as well as a record one-day coronavirus case number of 163,405. The spread of the pathogen in New York City meant the daily rate of cases and positivity was 2.6% – and Mayor de Blasio reiterated on Thursday that he would close schools if he reached 3%.
Earlier this week, the promise of an effective Pfizer PFE,
and BioNTech BNTX,
vaccine has prompted investors to move away from tech stocks that profit from the stay-at-home trend in favor of value-driven games that may benefit from the economic recovery, but the latter part of the week saw a resurgence in betting that were considered winners during the pandemic.
Federal Reserve Chairman Jerome Powell, during a webcasting panel with central bankers on Thursday, warned investors not to exaggerate reports on vaccines. “From our perspective, it is simply too early to confidently assess the implications of the news for the economy, especially in the short term,” he said.
“The next few months could be tough,” Powell said in the event which included European Central Bank President Christine Lagarde and Bank of England Governor Andrew Bailey.
Meanwhile, the market increasingly doubts that another coronavirus aid package can be worked out anytime soon by Congress, with a rift remaining between Republicans and Democrats on the scale and scale of a relief program to help unemployed Americans and struggling businesses.
Despite all headwinds, many investors remain bullish thanks to continued monetary support from the Fed, which promises accommodative policies for the foreseeable future. Investors also appear optimistic that the United States and other parts of the world are better prepared for a next wave of the spread of the coronavirus.
In a speech at the Memphis Economic Club, St. Louis Fed Chairman James Bullard said on Friday that the U.S. labor market has improved at a rapid pace this year from the aftermath of the financial crisis in 2008-2009.
“Basically unemployment has come down from the top very quickly, I’m not sure you can really understand how shocking that is,” he said.
He also said the United States had to be more careful not to let the new wave of COVID-19 hamper the nascent recovery.
Meanwhile, better than expected results from Walt Disney Co. DIS,
and Cisco Systems CSCO,
also helped boost the buying mood on Wall Street on Friday. Also, post-it maker and diversified industrial company 3M Co. MMM,
said Friday sales rose 3% in October to $ 2.9 billion.
Investors are still keeping an eye on Joe Biden’s transition to the White House after being screened as the winner of the 2020 US presidential election against incumbent President Donald Trump.
In economic reports, the producer price index rose 0.3% last month, the government said on Friday. It has increased six months in a row since the economy reopened in May. Wholesale inflation has been largely subdued, however. The increase in producer prices over the past 12 months fell from 0.4% to 0.5%.
Separately, a University of Michigan consumer sentiment report revealed concerns about the coronavirus resurgence, with the United States falling to 77 in November after a previous reading of 81.8.
What stocks are targeted?
- Cisco Systems Inc. stocks jumped 7.1% after the maker of network services, video conferencing tools, and quarterly earnings and security software outlook beat Wall Street estimates, and it announced a new chief financial officer.
- Disney closed its fiscal year with another quarterly loss, resulting in the entertainment giant’s first annual loss in more than 40 years, but a better-than-expected performance during the quarter pushed stocks higher in extended trading on Thursday. Shares gained 1.8%.
-
JetBlue Airways Corp. JBLU,
+ 4.78%
provided details of its plans to limit onboard capacity for the busy holiday season and its plans to open all its seats, saying the decision was backed by “science validating the safety of the aircraft cabin” . Shares rose 3.2% early Friday. -
Actions of Li Auto Inc.
AT,
+ 8.11%
climbed 23% to another record on Friday, after the China-based electric vehicle maker reported its first quarterly results since going public, in which it reported a larger than expected net loss as revenue exceeded forecast, as deliveries continued to increase. -
Actions of Spectrum Brands Holdings Inc. SPB,
+ 3.10%
rose 5.2% on Friday, after the home, pet and garden care company reported fourth-quarter tax profit and sales that beat expectations, citing high demand and a strong point of sale amid a “rapid recovery” from COVID-19 supply disruptions. -
Actions of DraftKings
DKNG,
+ 4.16%
rose 6.9% to over $ 44 after the company beat revenue and profit estimates. The gambling site lost 57 cents a share, less than expected for a loss of 63 cents. Revenue was $ 132.8 million, beating estimates by $ 131.6 million. - By Dash filed a public share offer on Friday. The food delivery business will be listed on the New York Stock Exchange under the symbol DASH.
How are other assets traded?
The yield on the 10-year US Treasury note TMUBMUSD10Y,
was little changed at 0.89% on Friday. Bond yields and prices move in opposite directions.
The pan-European Stoxx 600 Europe SXXP index,
trading less than 0.1% more and London’s FTSE 100 UKX,
was trading at 0.4% on Friday.
Oil futures fell, with the US benchmark CL.1,
losing 51 cents, or 1.2% to hit $ 40.62 a barrel. GCZ20 Gold Price,
traded higher, with the December contract climbing $ 18.90, or 1%, to trade at $ 1,892.20 an ounce.
The ICE US Dollar DXY index,
a measure of the currency against a basket of six major rivals, was down less than 0.2% to 92.821.
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