Wall Street started the week on a bullish note amid expectations of further stimulus that could be issued by the incoming Biden administration — and more in Tuesday’s stock market recap.
Comments from Treasury Secretary nominee Janet Yellen, the Federal Reserve Chair under President Barack Obama, also lifted sentiment after she stressed the need to go “big” on stimulus. She also indicated the U.S. needs to be prepared to take on China’s abusive policies.
The Nasdaq gained 1.5% after testing an intraday high of 13,206.
The Russell 2000 jumped 1.3% with the afternoon peak reaching 2,152.
The S&P 500 was up 0.8% following the second-half push to 3,804.
The Dow added 0.4% with the opening high tapping 31,086.
Energy and Communications led sector strength after soaring 2% and 1.8%, respectively. Real Estate and Consumer Staples were the weakest sectors after giving back 0.7% and 0.4%.
General Motors Co. (NYSE: GM) rallied nearly 10% after the company entered a long-term strategic relationship with Microsoft Corp. (Nasdaq: MSFT) to accelerate the commercialization of self-driving vehicles. As part of the relationship, Microsoft will join General Motors, Honda Motor Co. (NYSE: HMC) and institutional investors in a combined equity investment of more than $2 billion in GM’s Cruise vehicles, bringing the post-money valuation to $30 billion.
Netflix Inc. (Nasdaq: NFLX) will announce quarterly results after today’s closing bell. The company is expected to earn a profit of $1.39 a share on revenue of $6.33 billion. The high estimate is at $1.70 a share with the low forecast at $1.26, equating to a 31-cent beat or an 13-cent miss.
The company has missed forecasts the past three quarters by -40 cents, -22 cents and eight cents with a beat of 77 cents in the year-ago period. There are 40 analysts that cover the stock with nine Strong Buy ratings, 15 Buys, 14 Holds, one Underperform and one Sell rating.
For the quarter, Wall Street is expecting 6.1 million paid-subscriber additions versus 8.8 million in the prior year quarter.
The global stock market recap showed European markets closed lower across the board as possible extensions of German lockdowns weighed on sentiment. Specifically, German Chancellor Angela Merkel appears set to agree with regional leaders to extend a lockdown for most businesses and schools until mid-February,
The Belgium20 dropped 0.9% and France’s CAC 40 was lower by 0.3%. Germany’s DAX 30 and the Stoxx 600 dipped 0.2% while the UK’s FTSE 100 slipped 0.1%.
Asian markets settled mostly higher following news China’s economy increased by nearly 2% in 2020.
Hong Kong’s Hang Seng soared 2.7% and South Korea’s Kospi surged 2.6%. Japan’s Nikkei rallied 1.4% and Australia’s S&P/ASX 200 advanced 1.2%. China’s Shanghai fell 0.8%.
No major economic news.
The iShares 20+ Year Treasury Bond ETF (Nasdaq: TLT) was up for the second straight session after closing on the day’s high of $152.36. Current and lower resistance at $152-$152.50 was cleared and held. A close above the latter would signal a retest towards $153.50-$154.
Support is at $151.50-$151 followed by $150.50-$150.
The iPath S&P Vix Short-Term Futures (NYSEArca: VIX) was down for the first time in three sessions following the intraday fade to 22.53. Near-term and upper support at 23-22.50 and the 50-day moving average were breached but held. A move below the latter would signal another retest towards 21.50-21.
Lowered resistance is 23.50-24 followed by 25.50-26.
The Invesco QQQ Trust (Nasdaq: QQQ) snapped a two-session slide with the intraday high reaching $316.93. Prior and lower resistance at $316.50-$317 was breached but held. A close above the latter would indicate momentum towards $318.50-$319 with the recent all-time peak at $319.39.
Support is at $315.50-$315 followed by $313.50-$313.
RSI (relative strength indicator) is back in an uptrend with key resistance at 60 getting challenged but holding. Continued closes above this level would signal additional strength towards 65-70 with the latter representing the December top. Support is at 55-50.
The Consumer Discretionary Select SPDR (NYSE: XLY) snapped a three-session losing streak with the high reaching $167.48. Current and lower resistance is at $167-$167.50 was cleared but held. A close above the latter would likely indicate additional strength towards $168.50-$169 with last week’s all-time high at $169.17.
Support is at $166-$165.50 followed by $164.50-$164.
RSI is trying to curl higher with lower resistance at 65-70 holding. A move above the latter would suggest a retest towards 75-80 and levels from earlier this month. Support is at 60-55.
Check back after the closing bell for the most important news and numbers in the WealthPress stock market recap.