Dow Jones, S&P 500, and Nasdaq advanced as Joe Biden said that the economic package would be in the trillions of dollars
- For the week, the Dow Jones advanced 1.61%, the S&P 500 1.83%, and the Nasdaq 2.43%
- The U.S. President Joe Biden said that the economic package would be in the trillions of dollars
- The economic package will be unveiled this Thursday
The U.S. stock market advanced in the first trading week of 2021, and Wall Street’s three main indexes surged to record highs. The U.S. President Joe Biden said that the economic package would be in the trillions of dollars, and investors hope that a fiscal stimulus and coronavirus vaccines will drive a robust economic recovery in 2021.
The economic package will be unveiled this Thursday, and according to Joe Biden, it will include unemployment insurance and rent forbearance. The Democrats want to inject a lot of money into the economy, but some Wall Street analysts expect an equity pullback in the near-term.
Are you looking for fast-news, hot-tips and market analysis? Sign-up for the Invezz newsletter, today.
“Positive vaccine data and expectations of a bigger fiscal package and infrastructure spending under a Democratic-led U.S. Congress have pushed the S&P 500 above 3,800 points for the first time. Stocks are going to start to price in a bigger economic relief package from the Biden administration that is going to continue to be the driver on equities,” said Ed Moya, senior market analyst at OANDA in New York.
Despite this, the current risk/reward ratio is not good for long-term investors, and the U.S. stock market remains overvalued. The U.S. released the December Nonfarm Payroll report last Friday, the country lost 140K job positions in December, but the unemployment rate remained steady at 6.7%.
The terrible U.S. employment figures may indicate that even worse is coming and that the U.S. stock market’s correction could be around the corner. The U.S. still needs to face the COVID-19 challenges, and the U.S. Federal Reserve will support the economy for as long as needed.
S&P 500 up 1.83% on a weekly basis
For the week, S&P 500 (SPX) booked a 1.83% increase and closed at 3,824 points. S&P 500 has advanced above 3,800 points for the first time, and according to technical analysis, this index remains in a buy zone.
If the price jumps above 3,850 points, it would be a “buy “signal for the S&P 500, but if the price falls below 3,600 points, it would be a strong “sell” signal, and we have the open way to 3,400 points.
DJIA up 1.61% on a weekly basis
The Dow Jones Industrial Average (DJIA) advanced 1.61% for the week and closed at 31,098 points.
The Dow Jones continues to post higher-highs, and if the price jumps above 31,500 points, it would be a buy signal for Dow Jones Industrial Average (DJIA), and we have the open way to 32,000 points. On the other side, if the price falls below 30,000 points, it would be a firm “sell” signal, and the next target could be around 29,000 points.
Nasdaq Composite up 2.43% on a weekly basis
The Nasdaq Composite (COMP) advanced 2.43% on a weekly basis and closed at 13,202 points.
As long the price is above this trend line and 12,000 points, the Nasdaq Composite index remains in a bull market, and there is no indication of the trend reversal.
The U.S. stock market advanced in the first trading week of 2021 as equities and government debt yields rise on hopes for further fiscal stimulus. Dow Jones rose 1.61% for the week, the S&P 500 1.83%, Nasdaq 2.43%, and all three indices remain in a bull market.