Thursday, January 07, 2021
Wall Street in record fever
Blue wave drives US stock exchanges higher and higher
In the next two years, the Democrats not only provide the president, but also control the House of Representatives and the Senate. That pleases investors who hope for further stimulus packages in view of the corona crisis. Together, the major indices are climbing new records.
The record hunt on Wall Street is still intact. After the all-time highs in the middle of the week, the Dow Jones, S&P 500 index and Nasdaq composite reached new record highs well above them on Thursday. The temporary storming of the Capitol by supporters of the outgoing President Donald Trump was the dominant topic, but it played practically no role in setting the course.
Instead, the market is relying on further economic stimuli, presumably linked to higher debts, under the future Democratic President Joe Biden, especially since he now has majorities in both chambers of Congress, also known as the blue wave in stock market jargon. Early on Thursday, Biden's election victory was certified by Congress despite disruptive maneuvers by Republican representatives. The economists at Bank of America think it is possible that the Democrats could launch an economic stimulus package worth nearly 1 trillion dollars and speak of a "game changer" for economic growth in 2021.
But hopes of successful vaccination campaigns against the corona pandemic were also named as price drivers, while at the same time, on the economic side, the weekly data on the labor market turned out better than expected and the purchasing managers' index for the US service sector also surprised positively.
The price rally was broadly based, but the technology stocks that were still lagging behind on Wednesday were clearly favored. The financially and technologically heavy ones Nasdaq-Indices shot up as much as 2.6 percent. The Dow Jones-Index gained 0.7 percent to 31,041 points. The new record high is 31,193 points. The S&P 500 increased by 1.5 percent.
Banks continue to be spurred on by rising yields
Bank stocks rose again sharply, their sub-index rose by 2.6 percent and was only outperformed by the technology and auto indices, which rose 3.0 and 6.9 percent. The driver for bank stocks was again the significantly higher interest rate level, because this benefits the interest and investment business of the financial institutions.
Were in the auto sector Tesla continues to hunt for records after the stock was finally included in the prestigious S&P 500 index shortly before Christmas. On the day of the report, it was another 7.9 percent up to a good $ 816. Analyst Joseph Spak from RBC Capital Markets gave up his negative assessment of the share at a record high, admitted a misjudgment and now rates the share as "sector performance" instead of "underperform". Tesla recently had sales figures for 2020 that practically achieved the ambitious target despite the Corona crisis.
The very solid the day before Walgreens Boots Alliance after the figures for the first fiscal quarter were presented, they jumped another 5.2 percent and were the best Dow value. On an adjusted basis, the pharmacy chain exceeded analysts' expectations for profit more clearly than in years.
Bed Bath & Beyond fell by almost 11 percent. The furnishing retailer had reported disappointing sales and earnings figures for the third fiscal quarter.
T-Mobile US did 1.3 percent good. The Telekom subsidiary won more customers in 2020 than ever before. For many of the new contract customers, the development of the new ultra-fast 5G network was a decisive factor, according to T-Mobile.
The share of Enphase Energy benefited from inclusion in the S&P 500 index and gained 5.1 percent. She took over from Tiffany's place after the jewelry chain was taken over by LMVH.
After the losses of the previous days, the dollar somewhat recovered. The dollar index was last 0.3 percent higher. The Gold price fell further, but this time only slightly by 0.2 percent to 1,914 dollars a troy ounce. It suffered from the fact that bond yields have risen recently, making gold relatively less attractive as an investment. The Oil prices Moved less dynamically after the most recent rally, but continued to climb to ten-month highs. US oil last cost $ 50.96 a barrel.