Donald Trump warned that electing Joe Biden president would send the stock market crashing down. That has not turned out to be the case. ...
Donald Trump warned that electing Joe Biden president would send the stock market crashing down. That has not turned out to be the case.
Wall Street kicked April off with a milestone on Thursday, as a tech company rally helped drive the S&P 500 past the 4,000 mark for the first time.
The benchmark index finished 1.2 per cent higher a day after closing out the first three months of the year with its fourth straight quarterly gain.
While Biden hasn’t said anything publicly about the performance of the stock market under his watch, he could take solace in the fact that Wall Street has surged at a higher pace during his first 50 days in office compared to that of Trump.
Since Biden’s inauguration on January 20, the S&P 500 has surged by 4.6 per cent.
During Trump’s first 50 days in office, the S&P performed well, but not quite as well - jumping by 4.4 per cent.
The S&P 500 index rose by nearly 1.2 per cent on Thursday to finish at 4,019.87, a new record
Trump’s predecessor, Barack Obama, was faced with a more precarious situation as he inherited a financial crisis upon entering office.
The S&P under Obama fell by 6.1 per cent during the first 50 days of his administration.
Microsoft, Apple, Facebook and Google's parent company were among the winners on Thursday, along with smaller companies, which stand to benefit from a quickly growing economy.
Health care, household goods stocks and utilities were the only laggards.
Technology stocks benefited from another drop in bond yields, which have been the driving force for the market for several weeks.
The yield on the 10-year US Treasury note fell to 1.69 per cent from 1.73 per cent the day before.
Higher bond yields make stocks seem more expensive by comparison, and tech stocks are among the most expensive after their significant rise last year.
Microsoft rose 2.8 per cent, Facebook gained 1.4 per cent, Amazon.com added 2.2 per cent and Google parent Alphabet closed 3.3 per cent higher.
'What a great way to start the second quarter,' said J.J. Kinahan, chief strategist with TD Ameritrade.
'There's money out there looking to be put to work, and with the quarter ending it looks like people are finding new ways in a new quarter to find opportunities.'
The S&P 500 rose 46.98 to 4,019.87.
The index's latest all-time high is its second in seven days. The Dow Jones Industrial Average gained 171.66 points, or 0.5 per cent, to 33,153.21.
The technology-heavy Nasdaq climbed 233.23 points, or 1.8 per cent, to 13,480.11.
Smaller companies continued to notch solid gains. The Russell 2000 index picked up 33.38 points, or 1.5 per cent, to 2,253.90.
The rally capped a holiday-shortened week for the stock market.
US stock exchanges will be closed in observance of Good Friday, though bond trading will be open for half a day, closing at noon Eastern.
Companies that would benefit from greater sales of electric vehicles also rose Thursday, a day after President Joe Biden outlined various measures to support their use as part of his massive infrastructure plan.
Part of that plan includes installation of thousands of additional charging stations around the country.
Electric vehicle charger operator ChargePoint gained 11.8 per cent.
Investors continue to monitor news about how well the US economy is recovering from the coronavirus pandemic, now that millions of vaccines are being administered daily to Americans as well as around the world.
Consumer sentiment has been improving along with construction spending and other measures.
The gains in the stock market were recorded a day after President Biden unveiled a new $2trillion infrastructure plan. Biden is seen above presiding over a cabinet meeting at the White House on Thursday
Several times last year, Trump tweeted that the economy would crash if he was not re-elected as president in 2020
The improving economy is prompting investors to shift more money into companies and sectors that will benefit from people getting back to some semblance of a pre-pandemic normal.
The market has been churning while dealing with that shift as beaten-down sectors like airlines and industrial companies start to recover.
'In a way, the churn has reflected health, because more sectors are participating in the moves,' said Ross Mayfield, investment strategy analyst at Baird.
While investors are optimistic that things will recover soon, there's still a lot of economic pain to go around.
Airlines have been making gains this year as more people bet on a budding recovery for travel, but the industry still faces turbulence ahead.
Discount carrier Frontier Airlines underwhelmed on its first day of public trading. The Denver-based airline opened at $18.61, below the low end of a $19 to $21 price target, and closed at $18.85.
The Labor Department said the number of Americans who filed for unemployment benefits last week rose to 719,000 last week from 658,000 the previous week.
That figure was expected to decline. The government will release its monthly jobs report on Friday.
'The employment market is going to be the thing to watch,' Mayfield said.
'We're kind of in a transition period and at some point we're going to need to see improvement there.'
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