(25 November 2020)DAILY MARKET BRIEF 1:Wall Street to Record Highs
US equities continued the bullish stance on Tuesday, with the three indexes updating their record highs. Investors expect a rapid recovery next year after the rolling out of the COVID vaccines. Also, the transition of President-elect Joe Biden to the White House is boosting sentiment.
The Dow exceeded the psychological mark of 30,000 for the first time ever, gaining 1.54% for the session. The S&P 500 rose 1.62%, and Nasdaq added 1.31%. All of the S&P 500’s 11 major sectors closed higher, with industrials and financials showing the best performance, up 2.8% and 4.2%, respectively.
President Donald Trump accepted on Monday the formal transfer of power, after refusing to admit the loss during the last few weeks.
Stocks were lifted by vaccine hopes, which helped the S&P record the best November ever days ahead of the end of the month. The US government said that it planned to release over 6 million coronavirus vaccine doses nationwide in an initial distribution.
On the economic front, the US consumer confidence index dropped to 96.1 in November, from 106.2 last month. Analysts expected a decline to 98.0. Some economists argue that this might not be the bottom. On the other side, the housing market continues its ascension, as home prices increased at the fastest rate in six years.
The market valuation of Tesla exceeded the $500 billion mark after the company’s stock surged another 7%. The share price rose over 30% since investors found out that the stock would become part of the S&P index. Year-to-date, Tesla expanded by an incredible 500%.
Boeing rose about 3% after European regulators approved its 737 MAX jets. American Airlines Group and United Airlines rose over 8% on expectations of economic and travel recovery.
JPMorgan agreed to pay $250 million in fines after the Office of the Comptroller of the Currency said that the bank’s asset and wealth management division admitted a “pattern of misconduct.” The regulator said that JPMorgan’s risk management controls were deficient while the giant couldn’t prevent conflicts of interest in the business.
HP reported better-than-expected Q2 results and boosted its guidance for the current fiscal quarter. The share price rose over 4% in after-hours trading.
In Asia, stocks are mixed in early trading on Wednesday, but bulls dominate as they leverage the vaccine optimism. China continues to flash red.
At the time of writing, the Shanghai Composite is down 0.74%, and the Shenzhen Component has tumbled 1.39%. Shares of electric vehicle makers declined after the government launched an investigation into the sector.
Hong Kong’s Hang Seng Index is up 0.25%, though it’s over 1% lower than session highs. The city continues to fight with a fourth wave of the pandemic. It reported over 80 cases on Tuesday.
Japan’s Nikkei 225 closed 0.50% higher, though it dropped over 1% from the session peak. South Korea’s KOSPI is down 0.52% after initial gains. The Bank of Korea will present its policy decision tomorrow.
In Australia, the ASX 200 closed 0.59% higher.
European stock futures are mostly bullish, except for German DAX.
