Investors are showing signs of increasing exuberance, reflecting optimism about a vaccine-fueled global recovery and the changed economics of the post-coronavirus world.
The Dow Jones Industrial Average rose 1.6% for the first week of 2021, marking its fourth-straight weekly gain despite a mob storming the U.S. Capitol Wednesday and a decline in nonfarm payrolls reported Friday.
The advance, which took the 30-stock index past 31000 in just 29 trading days, has been led by banks and energy firms. Bond yields have risen, taking the yield on the 10-year U.S. Treasury note to 1.105%, the highest since March.
When economically sensitive sectors and bond yields rise together, it often signals Wall Street is embarking on the classic reflation trade that anticipates a full-fledged economic recovery. It is important because it can herald rising incomes, stronger results at firms from retailing to manufacturing to technology, and further market gains.
But the blistering, stimulus-fueled rally over the past year may complicate that formula. While the case for economic recovery appears sound and many fund managers expect the market advance to continue, skeptics say stocks remain vulnerable to fallout from the pandemic, including still-high unemployment and questions about the pace of the vaccine rollout. Supercharged gains in assets from some favored stocks to cryptocurrencies to some commodities could turn out to be unsustainable.
Related Post
Tony Gibson has been charged following the death of a stevedore.
Former chief executive of the Ports of Auckland Tony Gibson. Photo / Doug SherringBy RNZ The former chief executive of the Ports of Auckland, Tony...
“We are hoping to use half of the ASEAN Response Fund to purchase vaccines for each ASEAN member state with UNICEF and this is through the COVAX facility,” Lim said during the 5th ASEAN Media Forum.
The Association of Southeast Asian Nations (ASEAN) will be using half of its response fund to purchase vaccines against the coronavirus disease 2019 (COVID-19) for...
An international research team has retraced the astonishing lifetime journey of an Arctic woolly mammoth, which covered enough of the Alaska landscape during its 28 years to almost circle the Earth twice. Scientists gathered unprecedented details of its life …
ByUniversity of Alaska FairbanksAugust 13, 2021 An illustration of an adult male woolly mammoth navigates a mountain pass in Arctic Alaska, 17,100 years ago. The...
Liverpool defender Virgil Van Dijk has signed a new four-year deal, the club announced on Friday.
Virgil Van Dijk was a crucial part of the Liverpool side that ended the club's 30-year wait for a Premier League title in 2020. Photo by...
Pakistan PM accuses US of seeing his country as useful only in context of ‘mess’ it is leaving behind in Afghanistan.
Pakistani Prime Minister Imran Khan has accused the United States of seeing his country as useful only in the context of the mess it is...