U.S. stock markets were closed on Monday in observance of The Reverend Dr. Martin Luther King, Jr.’s birthday. Last week was a disappointing one for Wall Street in which all the three major stock indexes - the Dow, the S&P 500 and the Nasdaq Composite - recorded worst weekly losses since the week ended Oct 30, 2020. This week will be significant both politically and economically as President elect Joe Biden will formally take charge of the U.S. President on Jan 20.
Proposal of a New Coronavirus Relief Package
On Jan 14, President elect Joe Biden proposed a new $1.9 trillion coronavirus-aid package called “American Rescue Plan”. The proposed plan will include increasing direct payments to $2,000 from existing $600 and supplemental unemployment benefits to $400 per week through September. Minimum wage rate to be hiked to $15 per hour and moratoriums on eviction and foreclosure on mortgages to be extended to Sep 30.
The plan will include $20 billion for a national vaccination program, $50 billion for COVID testing, and $350 billion aid to state and local governments. In addition, the plan will provide $130 billion for reopening of schools, $35 billion for higher education and $5 billion for a “Hardest Hit Education Fund. Two Near-Term Concerns
On Jan 15, Pfizer Inc. (
PFE Quick Quote PFE - Free Report) said that it will slow down the delivery of its COVID-19 vaccine to Europe for the time being. The company will upgrade its COVID-19 vaccine production facility to 2 billion doses per annum. On the same day, The Wall Street Journal reported that the Securities and Exchange Commission has opened an investigation on Exxon Mobil Corp. ( XOM Quick Quote XOM - Free Report) over its valuation of a key asset in the oil-rich Permian Basin. The news has a negative effect on the oil industry. The Energy Select Sector SPDR (XLE), one of the 11 broad sectors of the S&P 500 Index plunged 3.9% following the news. Both Pfizer and Exxon Mobil carry a Zacks Rank #3 (Hold). You can see . the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here China's Q4 2020 GDP Outperforms
The People’s Republic of China has released its figures for Q4 Gross Domestic Product (GDP), that increased 6.5%, higher than the 6.1% analysts were expecting. Considering how the Covid-19 pandemic has ravaged most of the world and their economies, the country where the coronavirus originated (in its central Wuhan region) has managed to push 2020 GDP overall to 2.3% upward.
However, this was its lowest GDP growth rate in over 40 years. Though all numbers are reported through the Chinese central government with no independent oversight, economists are paying attention to this as the second largest economy of the world is showing signs of recovery.
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