US stocks are holding steady, with the S&P 500 setting a new high for the sixth day.
The major catalysts are Jobless Claims, ISM PMI, OPEC+, and the IMF release.
Despite the Fed’s hawkish stance, Covid difficulties and pre-NFP fear point to further gains.
On Thursday, Wall Street benchmarks closed higher, with the S&P 500 continuing its bull run, as positive US data and remarks from the International Monetary Fund keep buyers optimistic ahead of the important Nonfarm Payrolls report (NFP).
However, the Dow Jones Industrial Average (DJI) advanced 131.02 points, or 0.38 percent, to 34,633.53, while the Nasdaq gained 0.13 percent, or 18.4 points, to 14,522. Further, the S&P 500 reached a new high of 4,320.66 before completing the day at 4,319, up 0.52 percent.
Despite the fact that the headline US ISM Manufacturing PMI was a tad lower than 61.00 predicted and 61.2 compared to 60.6 in June, the specifics on inflation were positive. Weekly Jobless Claims and the four-week average of the early signal of today’s jobs report also supported the bulls.
Furthermore, according to the Wall Street Journal, Philadelphia Federal Reserve Bank President Patrick Harker favors the commencement of a bond-buying retreat later this year. Similarly, the International Monetary Fund (IMF) raised its US GDP growth prediction from 4.6 percent to 7.0 percent in April.
While these events combined to boost the market’s euphoria, confusing messages from OPEC+ and concerns about US President Joe Biden’s demand for curbs on global business behemoths added to the pre-NFP caution to test the bulls. The growing coronavirus (COVID-19) crisis in Asia-Pacific could also be highlighted as a barrier to the north.
In terms of individual stocks, Walgreens became the worst performer on the S&P 500, falling almost 7.0 percent, while Novocure fell 14.5 percent due to unfavorable data from phase 2 tumor treatment studies.
In this environment, US Treasury rates are hovering around 1.45%, moderately bid, while the US dollar index (DXY) has risen to a three-month high.
Moving forward, investors will be looking for a stronger NFP figure for June, which is estimated to be 690K versus 559K previously, as well as no negative surprises, to keep the current optimism going into H2 2021.
Read: NFP Predictions: Four Reasons Why June’s Jobs Report Could Be Bad for the Dollar/n
