The holiday shortened week brought market gains as an early holiday present! Are the gains sustainable?
Monday
In a re-occurring theme, Monday brought good vaccine news as AstraZeneca announced a 70% efficacy for the broader trial results. This marks the third week in a row where a vaccine trial opened the week with optimistic efficacy data.
Tuesday
Markets climbed on Tuesday as optimism over vaccine progress drove sentiment. S&P 500 led the charge and the irrelevant Dow Jones Industrial Average crossed 30,000 for the first time in history. A mark that truly is nothing more than a psychological threshold. For a bit of historical reference:
- Feb. 12, 2020: 29,551
- Oct. 5, 2007: 14,066
- Jan. 7, 2000: 11,522
All three major indices climbed over 1% on the day.
Wednesday
Markets pulled back some of the gains from Tuesday. An increase in initial jobless claims bought cause for concern. It is feared that the elevated illness rate is beginning to negatively impact the already strained job market.
Thursday
Happy Thanksgiving!
Friday
The stock market closed early in recognition of the Thanksgiving holiday. Market activity was muted on light volume. Volumes were cut in half Wednesday and Friday due to the holiday. Even on light volume, markets inched closer to a stellar November as the S&P 500 added .25% on the day.
Conclusion
Markets added 2.27% across the holiday shortened week. Investor sentiment seemed strong across the week as markets looked past the current increases in COVID cases. The focus was to the future and a post COVID world. Risks still remain as case counts, lockdowns, unemployment, and deaths all continue to increase. News around vaccines is great, but sustainable growth from markets will only come from financial change. Meaning that stimulus will provide long-term stability of the recent growth trend, rather than headlines. Headlines can be fickle and until we get stimulus, volatility should be expected to remain elevated.
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