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Plus 5 New Strong Buys for Today
Kevin Matras   
Profit from the Pros
By Kevin Matras
Executive Vice President 		Zacks Investment Research
  

Stocks Finish In The Green, Fed Chair Says Economy Is "Healing"

Stocks closed higher yesterday, building on Monday's late-day momentum and carrying it into Tuesday.

All of the major indexes remain below their 50-day moving average, but are now within striking distance of climbing back above that threshold.

The markets cheered Fed Chairman Jerome Powell's comments yesterday when he told the House Financial Services Committee that he believed the economy was "healing."

Treasury Secretary Steven Mnuchin also told the House committee that the country was in the "midst of the fastest economic recovery from any crisis in history."

But both lamented that while some parts of the economy were snapping back strongly, others parts were still suffering. And they stressed the need for more fiscal stimulus to help those most in need.

Whether we see Congress put aside their differences and get something done remains to be seen.

Fortunately, Mr. Powell reiterated the Fed's commitment to use every tool at their disposal to support the economy.

In other news, the Redbook report showed same store retail sales up 1.5% y/y.

Existing Home Sales rose again, this time to 6.000 million units (annualized) vs. last month's 5.860M and views for 5.965M. Home sales have soared well above their pre-pandemic levels and are currently showing a 10.5% y/y growth rate.

We also saw strong gains in the Richmond Fed Manufacturing Index with a print of 21 vs. last month's 18 and estimates for 12.

Today we'll get another look at the economy with the MBA Mortgage Applications report, and the PMI Composite Flash report.

The only real downer yesterday was hearing that several countries in Europe are seeing increases in coronavirus cases, and are on the brink of shutting down again. Although, it looks like those areas will favor local shutdowns rather than national shutdowns. But it was a reminder that while the U.S. is making great progress emerging from its shutdown, especially economically, other parts of the world are not as fortunate.

The U.S. is expecting unprecedented growth for the remainder of the year. And record growth next year.

And that should lead to more gains in the market.

See you tomorrow,

Kevin Matras

Executive Vice President, Zacks Investment Research

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