Market Recap
US Markets:
In a limited trading day, stocks rose to close out the week as traders wrapped up a strong week amid political clarity and positive vaccine news.
After touching 30,000 points earlier in the week, The Dow Jones closed higher by 37.90 points, or 0.1% at 29,910.37. The S&P 500 notched another record closing high and gained 0.3%, while The Nasdaq also closed at a record high and advanced 0.9%.
The Dow and S&P 500 rose 2.2% and 2.3%, respectively, for the week while The Nasdaq posted a weekly gain of nearly 3%.
Cryptocurrency:
After plummeting by nearly $3,000 on Thanksgiving day, Bitcoin recovered somewhat and traded around $17,395. Bitcoin has been on an unprecedented run and broke past the $19,000 earlier this week. While investors are still largely bullish on Bitcoin’s upside, sentiment is now mixed because of overheating. Some expect Bitcoin to hit that elusive $20,000 mark before year’s end, while others believe that Bitcoin could have a deeper correction to $13,000. Other cryptos rose as well, with XRP continuing its surge this month. After plummeting by 10.42% Wednesday after skyrocketing by over 21% on Monday and 15.47% Tuesday, XRP led the way gaining over 8.75%. Due to a rise in unique addresses, buybacks from Ripple, and the possibility of a new product release, XRP has surged this month. Ethereum also gained 2.64% and Chainlink gained 5.32%.
Overall Market:
European stocks closed slightly higher with Frankfurt’s DAX 30 gaining 0.4%. This is the DAX’s highest level since February 21st. Data showed the Eurozone economic sentiment indicator fell less than expected in November, while third-quarter GDP figures for France moved higher. Brexit talks were set to continue which also excited investors, however gains were muted due to the extension of coronavirus restrictions. Canada’s TSX also gained 57 points or 0.3%, and gained 2.3% for the week as vaccine developments and political clarity in the US continued to improve sentiment. Mexican stocks however fell 1.7%. Mexican Stocks Close Lower
Although WTI crude futures fell 0.4% to $45.5 a barrel, the commodity booked an 8% gain for the week- its fourth consecutive weekly gain. While investors remain concerned about near-term fuel demand, hopes of a coronavirus vaccine, a possible delay in OPEC+’s planned production increase in January, political clarity drove the price up. Meanwhile, the dollar index lost 0.2% to 91.8 on Friday, and reached a 7-month low. There could be more room for the dollar to fall as well due to further stimulus, and investors moving towards riskier assets. Gold also dropped 1.3% to $1,787 an ounce, and fell 4.5% this week- the most it has declined in 2 months.
WHATS UP
The Cboe Volatility Index (VIX), which is the market’s most popular volatility index or fear gauge, briefly dropped below 20 for the first time since late February.
Retailers led the way as investors bet on a strong holiday shopping season. The SPDR S&P Retail ETF (XRT) rose 0.9% and hit an all-time high. Etsy shares popped 10.7%, and Gamestop advanced 9%. Amazon shares gained 0.3%, and Shopify climbed 1.5% after Adobe Analytics said Thanksgiving Day online sales rose to a record $5.1 billion.
Value stocks also continue outperforming growth stocks in November due to positive vaccine news sparking hope for a strong economic recovery.
For the month, the iShares Russell 1000 Value ETF (IWD) is up 14.6% compared to its growth counterpart, the iShares Russell 1000 Growth ETF (IWF), which is up 10.1% in that same timeframe.
Source: CNBC, TradingEconomics, Yahoo! Finance
