US Market scales new record high

The US stocks surged on Wednesday, 20 January 2021, with major indices- S&P 500 index, the Dow Jones Industrial Average, and the technology-heavy Nasdaq Composite all ended the session at new record closing highs. The market gains propelled up on stronger-than-expected corporate earnings reports and continued optimism that new leadership in Washington will help usher in an economic recovery.

At the close of trade, the Dow Jones Industrial Average index advanced 257.86 points, or 0.83%, to 31,188.38. The S&P 500 index added 52.94 points, or 1.39%, to 3,851.85. The tech-heavy Nasdaq Composite Index rose 260.07 points, or 1.97%, to 13,457.25.

Investors kept an eye on Washington, where Joe Biden was sworn in as president and delivered a call for unity. Joe Biden will take the oath of office to become US president later in the day, and he has a flurry of executive actions at the ready. He has also pitched a plan to pump $1.9 billion more into the struggling economy, hoping to act quickly as his Democratic party takes control of the White House and both houses of Congress. The hope on Wall Street is that such stimulus will help carry the economy until later this year, when more widespread Covid-19 vaccinations get daily life closer to normal.

A better-than-expected start to earnings reporting season is also helping to lift the market. Big-name companies like Procter & Gamble (PG) and Morgan Stanley (MS) also reported better than expected quarterly results, extending the positive start to earnings season.

Shares of Netflix jumped after the world's largest streaming service said it ended last year with more than 200 million subscribers for the first time and it would no longer need to borrow billions of dollars to finance its TV shows and movies.

Global oil prices rose on Wednesday as the likelihood of additional US economic stimulus stoked optimism over a boost to crude demand. Brent crude rose by US18 cents or 0.3% to US$56.08 a barrel. And the US Nymex gained US26 cents or 0.5% to US$53.24 a barrel.

ECONOMIC NEWS: US Homebuilder Confidence Pulls Back Further In January- US Housing Market Index fell to 83 in January after sliding to 86 in December, the National Association of Home Builders reported on Wednesday. With the unexpected decrease, the housing market index pulled back further off the record high of 90 set in November. The unexpected drop by the headline index reflected decreases by all three of the component indices, with the gauge charting traffic of prospective buyers showing a notable decline to 68 in January from 73 in December. The index gauging current sales conditions and the component measuring sales expectations in the next six months both fell by two points to 90 and 83, respectively.

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