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Wall Street closed mixed on Friday following uncertainty regarding a fresh fiscal stimulus by the U.S. government. The S&P 500 and the Nasdaq Composite ended in the red while the Dow managed to finish in positive territory. For the week as a whole, all the three major stock indexes ended in negative zone.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) rose 0.2% to close at 30,046.37. Notably, 21 components of the 30-stock index ended in the red while 8 in green and 1 remained unchanged. However, the Nasdaq Composite finished at 12,377.87, dropping 0.2% or due to weak performance by large-cap stocks.
Meanwhile, the S&P 500 lost 0.1% to end at 3,663.46. The Energy Select Sector SPDR (XLE) and the Financials Select Sector SPDR (XLU) retreated 1.2% and 1%, respectively. Notably, six out of eleven sectors of the benchmark index closed in the red and five in green.
The fear-gauge CBOE Volatility Index (VIX) was up 3.5% to 23.31. A total of 9.92 billion shares were traded on Friday, lower than the last 20-session average of 11.48 billion. Decliners outnumbered advancers on the NYSE by a 1.42-to-1 ratio. On Nasdaq, a 1.47-to-1 ratio favored decliners issues.
Uncertainty on New Fiscal Stimulus
The U.S. Congress is yet to reach an amicable solution related to a fresh tranche of coronavirus-aid package before the end of this year. The Democrats have rejected the $916 billion aid offered by the U.S. government, citing that it doesn’t include any additional federal unemployment insurance money. The Republicans have supported the bill.
On Dec 1, a bipartisan group of lawmakers proposed a $908 billion fresh coronavirus-aid package. The major components of the proposed bipartisan relief bill includes $160 billion for state, local and tribal governments, $180 billion for additional unemployment insurance, and $288 billion as support to small businesses including the Paycheck Protection Program.
However, Senate Majority Leader Mitch McConnell said he wants to pass a new stimulus excluding legal immunity for businesses or aid for state and local governments. He agreed to offer a new unemployment benefit scheme and Paycheck Protection Program small business loans. Meanwhile, the U.S. Senate, unanimously approved a one-week extension of federal funding to avoid a government shutdown and to provide more time for separate negotiations on COVID-19 relief bill.
The Department of Commerce reported that producer price index (PPI) inched up 0.1% in November after growing 0.3% in October. November's data was in line with the consensus estimate. Notably, this was the smallest increase in PPI in seven months. Year to date, PPI increased 0.8% in November compared with 0.5% in October.
The core (excluding volatile items) PPI increased 0.2% in November, in line with the consensus estimate. Year to date, the core PPI increased 0.9% in November compared with 0.8% in October.
The University of Michigan reported that its preliminary estimation for the U.S. consumer sentiment in December came in at 81.4 compared with 76.9 in November. The consensus estimate was 76.
A sub-index that measures current conditions increased to 91.8 in December from 87 in November, marking its nine-month high. Another sub-index that measures expectations for the next six months also increased to 74.7 in December from 70.5 in November.
Weekly Roundup
Last week was a disappointing one for Wall Street. The Dow, the S&P 500 and the Nasdaq Composite declined 0.6%, 1% and 0.7%, respectively. Massive spike of new COVID-19 cases in several states of the United States and lingering concerns about the approval of the second coronavirus-aid package were predominantly responsible for stock markets weakness.
State Street (STT - Free Report) is mulling strategic options for its asset management business — State Street Global Advisors. The options include a potential divestiture of the division. (Read More)
Huntington Bancshares Inc. (HBAN - Free Report) recently entered into an all-stock acquisition deal with Detroit-based TCF Financial Corp. , per which the former will merge with the latter with a total market value of about $22 billion. (Read More)
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
Stock Market News for Dec 14, 2020
Wall Street closed mixed on Friday following uncertainty regarding a fresh fiscal stimulus by the U.S. government. The S&P 500 and the Nasdaq Composite ended in the red while the Dow managed to finish in positive territory. For the week as a whole, all the three major stock indexes ended in negative zone.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) rose 0.2% to close at 30,046.37. Notably, 21 components of the 30-stock index ended in the red while 8 in green and 1 remained unchanged. However, the Nasdaq Composite finished at 12,377.87, dropping 0.2% or due to weak performance by large-cap stocks.
Meanwhile, the S&P 500 lost 0.1% to end at 3,663.46. The Energy Select Sector SPDR (XLE) and the Financials Select Sector SPDR (XLU) retreated 1.2% and 1%, respectively. Notably, six out of eleven sectors of the benchmark index closed in the red and five in green.
The fear-gauge CBOE Volatility Index (VIX) was up 3.5% to 23.31. A total of 9.92 billion shares were traded on Friday, lower than the last 20-session average of 11.48 billion. Decliners outnumbered advancers on the NYSE by a 1.42-to-1 ratio. On Nasdaq, a 1.47-to-1 ratio favored decliners issues.
Uncertainty on New Fiscal Stimulus
The U.S. Congress is yet to reach an amicable solution related to a fresh tranche of coronavirus-aid package before the end of this year. The Democrats have rejected the $916 billion aid offered by the U.S. government, citing that it doesn’t include any additional federal unemployment insurance money. The Republicans have supported the bill.
On Dec 1, a bipartisan group of lawmakers proposed a $908 billion fresh coronavirus-aid package. The major components of the proposed bipartisan relief bill includes $160 billion for state, local and tribal governments, $180 billion for additional unemployment insurance, and $288 billion as support to small businesses including the Paycheck Protection Program.
However, Senate Majority Leader Mitch McConnell said he wants to pass a new stimulus excluding legal immunity for businesses or aid for state and local governments. He agreed to offer a new unemployment benefit scheme and Paycheck Protection Program small business loans. Meanwhile, the U.S. Senate, unanimously approved a one-week extension of federal funding to avoid a government shutdown and to provide more time for separate negotiations on COVID-19 relief bill.
Consequently, shares of reopening stocks like Carnival Corporation & Plc (CCL - Free Report) , United Airlines Holdings Inc. (UAL - Free Report) , The Gap Inc. (GPS - Free Report) and Hyatt Hotels Corp. (H - Free Report) plummeted 4.5%, 2.6%, 3.6% and 1.4%, respectively. The Gap carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Economic Data
The Department of Commerce reported that producer price index (PPI) inched up 0.1% in November after growing 0.3% in October. November's data was in line with the consensus estimate. Notably, this was the smallest increase in PPI in seven months. Year to date, PPI increased 0.8% in November compared with 0.5% in October.
The core (excluding volatile items) PPI increased 0.2% in November, in line with the consensus estimate. Year to date, the core PPI increased 0.9% in November compared with 0.8% in October.
The University of Michigan reported that its preliminary estimation for the U.S. consumer sentiment in December came in at 81.4 compared with 76.9 in November. The consensus estimate was 76.
A sub-index that measures current conditions increased to 91.8 in December from 87 in November, marking its nine-month high. Another sub-index that measures expectations for the next six months also increased to 74.7 in December from 70.5 in November.
Weekly Roundup
Last week was a disappointing one for Wall Street. The Dow, the S&P 500 and the Nasdaq Composite declined 0.6%, 1% and 0.7%, respectively. Massive spike of new COVID-19 cases in several states of the United States and lingering concerns about the approval of the second coronavirus-aid package were predominantly responsible for stock markets weakness.
Stocks That Have Mead Headline
State Street Gains on Plans to Sell Asset Management Unit
State Street (STT - Free Report) is mulling strategic options for its asset management business — State Street Global Advisors. The options include a potential divestiture of the division. (Read More)
Huntington & TCF Financial to Merge With $168B in Assets
Huntington Bancshares Inc. (HBAN - Free Report) recently entered into an all-stock acquisition deal with Detroit-based TCF Financial Corp. , per which the former will merge with the latter with a total market value of about $22 billion. (Read More)
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>