US stocks are expected to start the new year on a positive note, after ending 2020 volatility at a new high.
Investors, again, seem to be ignoring the worsening COVID-19 picture, rather than focusing on vaccine launches around the world. Hospitalizations in the U.S. reached a record high of 125,544 on Sunday, according to the COVID-19 screening project, while the UK has recorded 50,000 new cases for six consecutive days, with more severe restrictions to be announced.
However, the UK began launching the vaccine from pharmaceutical company AstraZeneca and the University of Oxford on Monday, boosting sentiment. The FTSE 100 UKX,
led the way, rising 2.5% with higher prices for GC00 metals,
HG00,
SI00,
helped the mining sector.
After rebounding in late 2020, with record highs for the Dow and S&P 500, the top three U.S. stock indices were set to make gains on the first trading day of the new year.
In our call of the day, LPL Financial’s chief market strategist, Ryan Detrick, said the strong year-end hike in 2020 could have “smiling bulls” in 2021.
The S&P 500 SPX,
rose more than 14% in November and December, ending a tumultuous year at a new record of 3,756.07 – up 16.3% in 2020. Detrick said a gain of 10% or more in the last two months of the year led to a Highest S&P 500 in the following year every time since World War II. “In fact, January has also been higher each time, so maybe this strong increase is a clue to higher prices in [2021]. ”
On the previous five occasions, the index rose more than 10% in November and December – 1954, 1962, 1970, 1985 and 1998 – the S&P 500 gained an average of more than 18% the following year. The index also rose in all five January, up 3% on average.
The chart below shows what a typical year looks like after an increase of 10% or more in November / December. “Once again, solid returns are the historic handbook,” added Detrick.
Source: LPL Research, FactSet
The markets
US stock futures YM00,
ES00,
NQ00,
pointed high on Monday morning, with the Dow Jones Industrial Average DJIA,
set for a gain of 150 points at the opening. European actions started the year on the right foot, driven by the launch of vaccines across the continent. Asian markets also rose to start the new year amid global optimism. The US dollar DXY index,
fell 0.3% to 89.51 – the lowest level since April 2018.
The buzz
Democratic lawmakers on Sunday called for swift and serious action against President Donald Trump after he was heard on a leaked audio tape urging Georgia’s Republican Secretary of State to “find” more votes to reverse his electoral defeat in the state.
Second-round elections for two US Senate seats in Georgia will take place on Tuesday, which will decide whether Democrats or Republicans control the Senate.
Teledyne Technologies TDY industrial conglomerate,
said he agreed to buy thermal imaging camera supplier Flir Systems FLIR,
in a cash and stock transaction valued at about $ 8 billion.
Shares of the UK gambling company Entain ENT,
formerly GVC Holdings, rose 26% on Monday, after rejecting an offer to offer 1,383 pence per share from MGM Resorts MGM,
which valued the company at £ 8.09 billion ($ 11.06 billion).
Bitcoin BTCUSD,
hit a record high of $ 34,000 over the weekend, before dropping 11% on Monday to $ 29,800.
A UK judge ruled on Monday that Julian Assange, the founder and editor of WikiLeaks, should not be extradited to the U.S.
Health insurance company Centene Corp. CNC,
said on Monday that it has agreed to acquire Magellan Health Inc. MGLN,
for $ 95 per share, in a deal with a business value of $ 2.2 billion.
Carl Icahn sold more than half of his stake in Herbalife Nutrition Ltd. HLF,
and is giving up his seats on the board of the nutritional supplements company, taking a step back from a long-standing investment he fiercely defended against an attack by rival activist investor William Ackman.
Random readings
South Korea’s population falls for the first time in its history.
Swan rescued after hours trapped in a frozen lake.
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