The stock market finished higher following a bearish start to the session, with the Nasdaq leading a healthy intraday rally. The Dow was up 47, or 0.2%, to 27,740, the Nasdaq gained 118, or 1.1%, to 11,265, while the S&P 500 rose by 11, or 0.3%, to 3,386. Decliners outnumbered advancing issues by a 3-to-2 ratio on the NYSE, where volume was very light.
Traders said that bulls dodged yet another bullet today. Despite the post-Fed-minutes selloff, stocks finished the day in a very strong manner. As one trader explained, “While today’s rally was relatively ‘narrow’, with several sectors losing ground, the large-cap benchmarks closed near their intraday highs, confirming that bulls are still eager to ‘buy-the-dip.’”
Today’s jobless claims report was as confusing as it gets, as even though new claims jumped back above 1 million, the drop in continuing claims outpaced the increase. Due to the mixed report, the “lockdown-trade” was clearly on again, as tech stocks performed very well, while the traditional cyclical sectors struggled to hold their ground. As we witnessed over the past few months, the large-cap benchmarks could still hit new highs in this environment, but we might have to wait a bit longer for the broader rally that bulls are hoping.
Although the U.S. COVID numbers continue to trend lower, the pandemic is far from over, as the outbreaks in India, Brazil, Colombia, and parts of Europe continue to pose a major threat to the global economy. That said, the likelihood of another round of full lockdowns is decreasing, even in the case of a full-blown second wave of outbreaks, which could continue to support risk assets in the coming months. Despite the improving outlook, risks remain high, and volatility could still rise in the usually more active last quarter of the year.
“ Success is not final, Failure is not fatal: it is the courage to continue that counts.”
As always, have a great evening and stay tuned!!!