The S&P 500 is rising as Wall Avenue tries to recuperate from the rocky begin by 2021
The S&P 500 rose slightly on Tuesday, making up some of its heavy losses from the previous session as traders focused on two major Georgia elections.
The broader market index gained 0.1% and the Nasdaq Composite rose 0.4%. The Dow Jones Industrial Average, meanwhile, only fell 3 points.
Energy values rose about 3% after OPEC and Russia reportedly reached an agreement on an oil production plan. Chevron was trading more than 1% higher. The news also sent US oil futures up about 5%, breaking above $ 50 a barrel for the first time since February.
At the start of the session, stocks also received a boost after better-than-expected US manufacturing data was released. The Institute for Supply Management announced that its manufacturing index rose from 57.5 in November to 60.7 in December. Economists polled by Dow Jones expected an index of 57.
The Georgia runoff will determine whether Republicans can keep control of the Senate. Many fear that if the Democrats take control of the Senate, higher tax rates and more progressive policies could weigh on the market.
However, such an outcome could create the opportunity for a larger and faster package of expenses.
“Today’s Georgia Senate runoff could have a significant impact on the markets if both Democratic candidates win,” wrote Tom Essaye, founder of The Sevens Report. “We don’t see a Democratic Senate as a bearish game changer in the short term as there would still be a lot of positives in this market. But it would be a new and disregarded initial headwind for stocks.”
In the meantime, rising Covid-19 cases around the world and new lockdown restrictions kept investors informed. According to the Johns Hopkins University, more than 85 million Covid-19 cases have been confirmed worldwide, including 20.8 million in the United States.
England imposed a third coronavirus lockdown on Monday as the region grappled with a more transmissible variant of Covid-19. New York State has confirmed its first case of the new tribe, Governor Andrew Cuomo said Monday.
“Investors are feeling nervous this week,” Lindsey Bell, chief investment strategist at Ally Invest, said in an email. “COVID cases continue to rise and a new variant of the virus is spreading around the world. Drain races in Georgia could decide the composition of the Senate and the market has generally done better in a divided Congress.”
Stock moves came after a sharp sell-off on Wall Street at the start of 2021. The S&P 500 fell 1.5% on Monday, its worst daily performance since October 27th. Ten out of eleven S&P 500 sectors posted losses, led by real estate.
The blue chip Dow lost 382 points after losing 700 points from its daily low. The Nasdaq Composite was down 1.4% as the FAANG block collapsed early in the new year.
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