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Profit from the Pros By Kevin Matras Executive Vice President
Stocks Up With All The Major Indexes Hitting New Record Highs
Image: Bigstock
Stocks closed higher yesterday, with all of the major indexes hitting new record highs.
The market continues to rally as it looks toward the future – a future with a receding pandemic thanks to the vaccines, and a future where life starts getting back to normal. And that means more people getting back to work, and traveling, and spending money, and living their lives, which in turn means a growing economy.
And even though we just got done passing the latest relief/stimulus bill a few weeks ago, talk of another stimulus bill being put forth later this month shows the government is going to keep the fiscal spigot open to support the economy.
In other news, it was nice to see yesterday's ISM Services Index come in better than expected at 57.2 vs. last month's 55.9 and views for 53.5.
It was also nice to see the Weekly Jobless Claims come in better than expected as well with a decline of -3,000 new claims at 787,000 vs. views for 803K.
But the report everybody will be watching is this morning's Employment Situation Report. The consensus is only estimating that 65,000 new jobs were created last month (91K from the private sector and -26K from the public), with the unemployment rate ticking up from 6.7% to 6.8%.
This report will be watched even more closely than usual, given Wednesday's ADP Employment report (often considered a precursor for the official BLS (Bureau of Labor Statistics) Employment report), which estimated a -123K private payroll decline.
You never know how the market will react to a report. But it's quite possible we could see a rally regardless. Why? Because if it's good, it will be a relief, and underscore the solid recovery taking place. But if it's bad, that could lend further credence and urgency to the need for more stimulus, and to do it in a hurry.
We shall see. But it was pretty bullish to see all the indexes make new highs going into today's report.
Aside from a shaky first trading day of 2021, the markets are off to a great start this year.
So make sure you're taking full advantage of it.
Best,
Kevin Matras
Executive Vice President, Zacks Investment Research
There's still time to get in early. These aren't just 4 promising stocks. They were handpicked from hundreds of strong companies by Zacks' experts because they present the greatest upside for Q1 -- which experts predict will see impressive economic and GDP growth.
Stock #1: With climbing earnings estimates, strong demand coming out of pandemic shutdowns, and rumors of a partnership with Tesla in the air, this basic materials stock's future looks bright.
Stock #2: One of a small group of value stocks in the red-hot tech industry, this company produces key components for 5G, artificial intelligence and driverless cars.
Stock #3: This retailer grew same store-sales by 23% and online sales by 95% during the pandemic. After more than tripling the S&P's gain since March, this stock has serious momentum.
Stock #4: Under-the-radar security firm with a track record of beating earnings estimates. With cyberattacks becoming more common, this company has unprecedented growth prospects.
Deadline to download our just-released Ultimate Four Special Report is Sunday, January 10.
These stocks have upward price momentum, market-beating relative price strength and are also trading in the top third of their 52-week price range. Read More »
Catch breaking news on your stocks and funds at a glance, including timely recommendation changes ... Zacks Ranks ... Industry Ranks ... earnings announcements ... earnings estimate revisions ... and more. And now you can screen for new stocks to improve portfolio performance.
Here are 5 stocks added to the Zacks Rank #1 (Strong Buy) List today. Read More »
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