Thursday, December 31, 2020
From most angles, we would look at the year 2020 on the final day of the year and say, “Thank goodness — good riddance!” But if you’ve taken advantage of the Zacks’ stock recommendations over the past year, you’d more likely hope to have a repeat of the past year.
Markets are mixed, albeit on the slight side, in major index pre-markets. Volumes will likely not be ramping up until trading commences in January (tomorrow, New Year’s Day, is a trading holiday), but even if they close similar to how they open, this will have been a very good year for the stock market.
The question is whether we’ll close the year at all-time index highs, the way we did on Wednesday. Of course, the higher we go, the more pressure these new highs will be under — especially until we see the Covid vaccinations pick up speed and approach the guidance timeline for immunization, as well as new stimulus relief taking effect — but the point is investors definitely see the light at the end of the tunnel.
Being Thursday, new Initial Jobless Claims have hit the tape this morning. Results continue to improve from a few weeks ago, when new claims were jumping much higher; this is the second week in a row new claims are lower than the week previous: 787K new claims is still high, but notably down from the slightly upwardly revised 806K the week before. But the week of December 13th showed 892K claims — the highest they’d been since the summer. There is likely some holiday static with these figures, but given the choice between lower and higher claims, we’ll take the lower.
Continuing Claims have re-established their downward slope over the past four weeks, and are well down from where we were 12 weeks ago and before. This morning, 5.22 million longer-term jobless claims were made from two weeks ago — in fact, the lowest single-week read since the pandemic took hold. That said, millions of Americans are now supported by Pandemic Unemployment Assistance (PUA), which mercifully got refunded in the recently passed relief package through Congress at the start of this week.
Thus, it’s important to understand that we have many more than 5.2 million unemployed Americans as a result of this ongoing pandemic. The pandemic itself continues to rage forward, with infectious disease experts wary of another uptick in caseloads following holiday get-togethers for many Americans, despite warnings about such activities.
Though Covid infection numbers had begun to come down a bit, yesterday had more than 225K people in this country newly diagnosed with the coronavirus. Yesterday also saw the highest total of daily deaths since the pandemic began, north of 3,900 in a single day.
Like the faces of Janus from Greek mythology, we are pointing in two different directions currently. Of all the messes caused by 2020, this one may be the most important to clean up. But as Janus was the god of beginnings, transitions and passages, he may be among the most apt figures to consider as we move into a new year.
We here at Zacks wish you all a safe, happy and healthy celebration. See you on the other side, Monday morning!
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