Friday, December 18, 2020
Indexes Deliver Strong Gains
The Dow Jones Industrial Average, S&P 500 Index, Nasdaq Composite, and Russell 2000 Index all closed at record highs on Thursday. New highs tend to come in clusters that can last years, reinforcing the potential for a strong end to the year amid bullish trends and broad participation. For more on strong gains and the “Santa rally,” read the December 16, 2020, LPL Research blog.
Stocks open flat. US stocks are little changed this morning but are on track to finish the final full week of trading for this year firmly higher, with the Russell 2000 Index on pace to return more than 3% this week.
- Markets focus on the pending stimulus bill as investors anticipate resolution by the end of next week.
- Disagreements over Federal Reserve emergency lending programs and FEMA payouts remain sticking points.
- European stocks are modestly higher in midday trading, as the German DAX continues its outperformance.
- Asian markets were mostly lower overnight.
LEI data release today. The Conference Board will release its November Leading Economic Index (LEI) report today at 10 a.m. ET. The report is expected to provide further evidence of a decelerating economic recovery based on consensus estimates. We examine the data release and its implications for future economic growth in today’s LPL Research blog.
COVID-19 news. There were 233,000 new COVID-19 cases reported Thursday, up 2.9% from Thursday of last week (source: Johns Hopkins).
- Controlling for the week-over-week surge in cases in California, US cases fell by 7.9%.
- Intensive care units are at 92% capacity in Tennessee, while capacity in southern California is at 100%.
- New case growth in Western Europe continues to rise, prompting Denmark and regions of the United Kingdom to tighten restrictions (source: COVID Tracking Project).
LPL Research in the Media
LPL Research Chief Market Strategist Ryan Detrick was quoted in USA Today on the stock market.
LPL Research Equity Strategist Jeff Buchbinder was quoted in The Washington Post discussing the S&P 500.
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