US main stock indices closed in the black on Thursday, having regained losses. The rally was propelled by growth in stock prices of US hi-tech giants.The Dow Jones Industrial Average gained 0.2% (44 points) to trade at 29,496.85. The S&P 500 grew 0.43% to trade at 3,582.27. The Nasdaq Composite jumped 0.9% to 11,908.01.
Interestingly, all three benchmark indices opened in the red. They were wavering between gains and losses during the whole trading day. The positive dynamic was triggered by two factors: rising stocks of US hi-tech giants and a new round of the talks on the stimulus bill under the COVID-19 pandemic. Senate majority leader Mitch McConnel announced that Republicans are ready to resume talks with Democrats on a coronavirus financial aid from the government. This week, the US stocks are trading with uncertainty. On the one hand, investors' optimism is fed by the vaccine news that could boost global economic recovery. On the other hand, market participants are unnerved by ongoing economic troubles. Market sentiment is dented by rampant coronavirus rates, new lockdown measures, and vague prospects of the mass vaccination. As of now, the US reported over 11.5 million confirmed coronavirus cases. The death toll in the US logs over 250,000 cases.
Thus, the market has been reacting two mixed news. Promising news on the vaccine front implies that mass vaccination will take a significant amount of time, perhaps a few months or quarters. The short-term prospects are overshadowed by worries about a large-scale pandemic and a slowdown in the global economy.
Such market turbulence has been mirrored in the popular Dow Jones Industrial Average. The index logged an intraday record growth on Wednesday in light of the news that US pharmaceutical company Pfizer had registered its own COVID-19 vaccine. Later, New York authorities declared that public schools would be closed due to a sharp surge of infection cases. Some investors decided to stay away from the market because the Dow Jones Industrial Average and S&P 500 had already surpassed record highs.
Investors are wondering how fast the economy will be able to return to the pre-crisis mode. No wonder, investors are pleased about the news on the vaccine front. Nevertheless, some questions remain open. Market participants fear obstacles on the path to mass vaccination. So, healthcare authorities could challenge some vaccines. Besides, investors are worried about smooth production, transportation, and delivery of such a large number of jabs. Another problem is that the authorities could encounter aggressive behavior of vaccine opponents.
In the meantime, some American states re-imposed restrictive measures to curb the COVID-19 spread. In Minnesota, Wisconsin, Kentucky, and Illinois, the authorities forced bars and restaurants to close and obliged people to wear face masks in public places. On Thursday, the US watchdog for Disease Control and Prevention urged Americans not to travel on Thanksgiving Day, referring to the increase in the rates of hospital admittance and deaths from the coronavirus infection.
In addition to ongoing worries about the second pandemic wave, on Thursday investors received another food for thought - information about the current conditions of the US economy.
According to a weekly update on unemployment claims, the number of initial applications for unemployment benefits grew to 742,000 last week. Recently, investors were encouraged by the green shoots of recovery in Q3 2020. However, the pace of economic recovery slowed down at the year end.
In a separate report, existing home sales spiked in October to the highest level in 14 years. An average home price also increased. According to the National Realtors Association, existing home sales climbed 4.3% in October from September. By the way, the US housing market played a crucial role in the economic recovery amid low mortgage rates, convenience for remote work, and a search for extra housing during the pandemic.
Experts believe that upbeat data on the housing market arouses confidence in a rapid economic recovery. The positive dynamics in housing can be safely transferred to other economic components.
While analysts are making long-term forecasts for markets, let's see how the stock markets reported in the late American session on Thursday.
Growth in the S&P 500 was led by shares of technology and energy corporations. Halliburton stocks rose more than 3%, while Apple and Amazon.com also posted strong gains.
L Brands stocks rallied more than 15% after the company announced that strong sales at Bath & Body Works offset a drop in revenue for the Victoria's Secret brand. The company's total quarterly revenue climbed by 14%.
Macy's shares were down 0.4%. The department store chain reported that its sales fell 20% in the third quarter.
The yield on 10-year US Treasuries fell to 0.853% from 0.880% on Wednesday.
The price of Brent crude oil fell by about 1% to $ 43.92 per barrel. Gold futures were down 0.7%.
The European Stoxx Europe 600 lost 0.8%.
Meanwhile, the major stock indices in the Asia-Pacific region (APR) have not demonstrated the common trend, trading mixed. It looks like investors continue to assess the news about the Covid-19 vaccine against the backdrop of the worsening epidemiological situation in the world.
Thus, Shanghai Composite rose 0.1% - up to 3,366.53 points, the Shenzhen Stock Exchange Shenzhen Composite gained 0.26%, to 2,281.85 points, the Hong Kong Hang Seng Index increased 0.35% to 26,449.07 points, South Korean KOSPI fell by 0.1% to 2,544.81 points, Australian S & P / ASX 200 edged down by 0.04% to 6,544.9 points, and Japanese Nikkei 225 dropped 0.36% to 25,485.95 points. The Japanese index has been weighed down by the country's downbeat macroeconomic indicators. According to published information, consumer prices in Japan fell by 0.4% in October in annual terms after zero inflation in September. On a monthly basis, consumer prices Japan also decreased by 0.4%.