Dow index rose 3.9% this week
Biden promotes $1.9 trillion in stimulus plan
US employment indicators are sluggish
Photo = AP = Yonhap News
In the New York Stock Market, the leading index rose in anticipation of stimulus.
On the 5th (local time) on the New York Stock Exchange (NYSE), the Dow Jones 30 Industrial Average closed at 31,148.24, up 92.38 points (0.3%) from the previous year.
The Standard & Poor’s (S&P) 500 index rose 15.09 points (0.39%) from the battlefield to 3,886.83, while the technology stock-oriented Nasdaq index rose 78.55 points (0.57%) to 13,856.30, all recording all-time highs.
The Dow index rose about 3.9% this week. The S&P500 and NASDAQ rose 4.7% and 6%, respectively. The leading index recorded the largest weekly increase since November last year.
The expectation of a $1.9 trillion stimulus package promoted by the Biden government raised investor sentiment. The US Senate and House of Representatives passed a budget resolution today.
The budget resolution is a measure that allows Congress to establish a stimulus bill using the right to adjust the budget, which only requires a majority consent. This is a way to introduce large-scale stimulus measures without the consent of the Republican Party.
The foreign press said that the Democratic Party will begin to formulate specific legislation, such as the provision of a cash payment of 1,400 dollars. House Speaker Nancy Pelosi stressed that the goal is to pass a new stimulus bill in the Senate within two weeks.
The Democratic Party is in a position to complete the introduction of the new stimulus package by mid-March, when additional support for unemployment benefits from the existing stimulus package ends.
However, the January employment index released by the US Department of Labor was sluggish. Employment in the non-agricultural sector increased by 49,000. This was slightly less than the 50,000 increase in the market forecast compiled by The Wall Street Journal. The number of new hires from November to December of last year was also lowered. However, the unemployment rate fell sharply from 6.7% in December to 6.3% in January. Experts had expected the unemployment rate to remain at 6.7%.
Experts predicted that the weaker-than-expected employment index would increase the need to introduce stimulus measures. Major companies’ performance was good. It was found that about 84% of companies including the S&P500 that announced their results recorded better-than-market net profits. Market expectations for future corporate performance are also being revised up.
News about the new coronavirus infection (Corona 19) vaccine also supported the rise in the stock market. Johnson & Johnson (J&J) has applied for emergency use of the Corona 19 vaccine to the US Food and Drug Administration (FDA). It is reported that the FDA is scheduled to hold a meeting of experts to evaluate the vaccine on the 26th. The share price of J&J rose 1.5% on the same day.
By industry on this day, all industries rose, except for the fact that technology stocks fell by 0.22%. Materials sector rose 1.71%, communication also rose 0.95%. On the Chicago Options Exchange (CBOE), the volatility index (VIX) fell 4.13% from the previous trading day to 20.87.
Reporter Chae Seon-hee [email protected]
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