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Stock Market News for Dec 30, 2021

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The S&P 500 and Dow closed at record highs on Wednesday, as investors shed Omicron fears despite a surge in new cases and hospitalizations. However, the Nasdaq closed slightly lower as the 10-year Treasury yield hit its highest in a month.

How Did The Benchmarks Perform?

The Dow Jones Industrial Average (DJI) gained 0.3% or 90.42 points to close at a record high of 36,488.63 points. The blue-chip index had previously hit an all-time high of 36,432.22 on Nov 8. This was also the index’s sixth straight day of gains.

Shares of Nike, Inc. (NKE - Free Report) and Walgreens Boots Alliance, Inc. (WBA - Free Report) gained 1.4% and 1.6%, respectively. Nike has a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

The S&P 500 rose 0.1% or 6.71 points to finish at a record high of 4,793.06 points. Real estate and healthcare stocks were the best performers. The Real Estate Select Sector SPDR (XLRE) and Heal Care Select Sector SPDR (XLV) each gained 0.6%. Eight of the 11 sectors of the benchmark index ended in positive territory.

The tech-heavy Nasdaq, however, lost 0.1% or 15.51 points to end at 15,766.22 points.

The fear-gauge CBOE Volatility Index (VIX) was down 3.36% to 16.95. A total of 7.89 billion shares were traded on Wednesday, lower than the last 20-session average of 11.15 billion. Advancers outnumbered decliners on the NYSE by a 1.20-to-1 ratio. On Nasdaq, a 1.43-to-1 ratio favored declining issues.

Investors Confident about Economic Growth

Markets declined slightly on Tuesday but it has so far been a good last week, with stocks continuing their rally. On Wednesday, the S&P 500 bounced back to close at a record high. The Dow also finished at a record high. However, the new record-high close came almost after seven weeks.

The interest-sensitive Nasdaq declined slightly as the 10-year Treasury yields hit it highest level of 1.54% in a month.

Despite stocks doing well on Wednesday, there wasn’t much to cheer for investors that could give further push to the rally higher. Trading has been low traditionally in the last week of the year and investors are now looking forward to 2022 with high hopes.

Investors are more confident and have shed of the Omicron fears despite a surge in new cases and hope that this year’s economic recovery and strong earnings from major American corporations will continue to support equity buying at least into the first quarter of 2022.

Economic Data

Data released on Wednesday showed U.S. trade deficit in goods in November jumped 17.5% to hit an all-time high and making 2021 the year to record the biggest annual shortfall in goods. The United States is now set to surpass the mark 2006 when it recorded the biggest international trade deficit.

In a separate report, National Association of Realtors said that pending home sales declined 2.2% in November month over month. Also, home prices in the United States increased 19.1% in November on a month-over-month basis.


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