Market Recap
US Markets:
Stocks rose to record levels on Friday, and booked a weekly gain for the fourth time in five weeks. This comes despite a disappointing U.S. jobs report.
The Dow Jones closed higher by 248 points, or 0.83%. The S&P 500 also gained 0.9%, and the Nasdaq advanced 0.7%. All three indices posted both intraday and closing record highs. Meanwhile, the small-cap Russell 2000 once again led the markets and popped 2.2%.
The November jobs report came well short of estimates. The latest report revealed that the U.S. added 245,000 jobs- well below the consensus estimate of 440,000. The unemployment rate, however, matched expectations by falling to 6.7% from 6.9%. The US trade deficit also widened to $63.1 billion in October from a revised $62.1 billion and compared to market expectations of $64.8 billion. The news however was more bullish for US factory orders. New orders for US manufactured goods beat expectations and jumped 1% from a month earlier. This marks the 6th consecutive month of rising factory orders.
COVID numbers also reached new record highs in new infections, single-day deaths, and hospitalizations. A report from Thursday that Pfizer may have issues rolling its vaccine out was also concerning on the COVID front. Pfizer saw some supply chain issues due to raw materials that did not meet its standards. However, because Pfizer and BioNtech are still on track to roll out 1.3 billion vaccines in 2021, this should more than make up for the estimated 50 million dose shortfall this year. Judging by the markets’ performance today, investors are not overly concerned.
Cryptocurrency:
With the exception of XRP plummeting by over 8% and keeping up with its volatile trend, cryptos did not move much today. It has not been a very volatile week overall for cryptocurrencies, with most of the major coins trading sideways. After Bitcoin broke past the $19,300 level, it pulled back towards $19,000 today. Earlier in the week, Bitcoin traded as high as $19,864 and broke its all-time high of $19,666 from back in December 2017. Although $20,000 still appears to be alluding Bitcoin, the benchmark cryptocurrency is now up over 150% since the beginning of the year, and has been propelled by economic stimulus, validation from public companies such as Paypal, and interest from major investors. Although some believe a Bitcoin correction is inevitable, others believe that it could exceed $20,000 before the end of the year as a hedge against inflation.
Overall Market:
European stocks ended the week mostly green with Frankfurt’s DAX 30 adding 0.2% largely due to better-than-expected German factory orders data and news that Poland would be more willing to agree to an EU €1.8 trillion stimulus package. Poland and Hungary have been the most opposed to a stimulus, and the deadline for the European Parliament and member states to reach an agreement on the annual budget is December 7th. The jobs report in Canada also revealed that the country added the least amount of jobs in 6 months. Although 62,000 jobs were created in November, which beat the forecasted 20,000, it is still a sharp drop from the 83,600 added in October.
Oil prices gained .9% and closed at $46 a barrel and booked its fifth weekly gain in a row. Oil rose on optimism that a bipartisan $908 billion coronavirus stimulus package could progress, and on OPEC and Russia’s agreement to ease oil output cuts.
WHATS UP
Chevron and Caterpillar each rose 3.9% and 4.3%, respectively, and led the Dow higher. Energy was the best-performing S&P 500 sector, gaining 5.4%.
Friday’s jump led to the major indices booking their fourth weekly gain in five weeks. The Dow rose 1%, the S&P 500 gained 1.7%, and the Nasdaq rallied 2.2%. The Russell 2000 also gained over 2% this week.
Source: CNBC, TradingEconomics, Yahoo! Finance
