Investors encouraged U.S. stocks to increase sharply last week, fueled by declining unemployment and the advancement of Covid-19 support and giving hope for a resilient economy.
The S&P 500 index of US blue-chip stocks, which are considered a symbol of American corporate health, rose 2 percent from week to Friday, performing well every four and a half months and its third straight week showing new results. – long time.
The list was heavily influenced by companies that were hit during the coronavirus epidemic, such as airline, cruise and casino, following Pfizer Notification that its antiviral pills effectively reduced the clinical risk from Covid-19 by 90 percent.
As evidence that the US economy is recovering from the effects of the epidemic, a recent job report shows an increase in employment in all sectors a few months after the recovery. 500,000 new jobs were created in October, and the unemployment risk dropped to 4.6 percent on a journey that exceeded expectations for economists.
“We are on a train to normalcy,” said Kristina Hooper, a senior global market expert at Investco. “We have not arrived yet but we are moving in the right direction. Growth is growing exponentially and is supported by the Covid medical experience.”
Scott Gottlieb, a former Food and Drug Administration Commissioner and board member of Pfizer, said Friday that the epidemic would end by January.
Live Nation Entertainment, which produces concerts downloaded and banned during the epidemic, rose more than 20 percent this week, the highest since March 2020 when the Fed first entered the financial markets to end the recession. from the plague. Royal Caribbean tour operators were also among the highest rides of the week, exceeding 14 percent.
“We have entered a new phase of the epidemic,” said Rebecca Patterson, chief financial officer at Bridgewater, adding that the sharp rise in stock markets has been fueled by careful comments from central banks this week.
The Federal Reserve took its first step to end financial aid in the wake of the epidemic on Wednesday.
The US Central Bank has announced that it will begin repaying its $ 120bn monthly purchases with a view to curbing the stimulus by the second half of next year.
The decision came as no surprise to investors, who have been waiting for guidance for months as negotiations between Fed officials continue.
Fed Chairman Jay Powell’s assurance that the central bank is following a patient approach when it comes to raising interest rates has also helped alleviate investors’ anger that higher lending rates are coming soon.
“They’re doing everything they can to avoid confusion,” Hooper said.
Additional reports by Nicholas Megaw and Kate Duguid