US stocks close sharply higher as investors anticipate passage of $900B economic aid package

US stocks close sharply higher as investors anticipate passage of $900B economic aid package

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4:05 pm: Wall Street upbeat on aid hopes US stocks closed at record highs as investors anticipate congressional passage of massive economic aid package.  Senate and House lawmakers closed in on a $900 billion rescue deal that would include a new round of direct payments to consumers. On the day, Dow Jones Industrial Average jumped 148 points, or 0.49%, to 30,303, a record closing high. The S&P 500 rose 0.58% to 3,722 and the tech-heavy Nasdaq increased 0.84% to 12,764 -- both record closes.  12.30pm: US benchmarks higher at lunch US stocks were heading north at lunch as market sentiment was boosted. The Dow Jones Industrial Average added around 88 points at 30,242. The S&P 500 added over 12 at 3,713. The technology stock laden Nasdaq gained over 60 at 12,718. In London, the FTSE 100 a bit earlier closed down nearly 20 points at 6,551. "The prospect of a breakthrough in both US stimulus, and Brexit talks have helped lift sentiment over the course of this week thus far, with that risk-on sentiment sending the dollar to the lowest ebb since April 2018," said Joshua Mahony, Senior Market Analyst at online trader IG. "While the trimmed-down US stimulus package being touted falls well short of the numbers suggested pre-election, markets seem more than happy to take any short-term win in anticipation of a more comprehensive package once Biden takes office." 10.25am: Proactive North America headlines: Humanigen Inc (NASDAQ:HGEN) (FRA:0KB2) completes patient enrollment for Phase 1 ifabotuzumab brain cancer study Great Panther Mining Limited (TSE:GPR) (NYSEAMERICAN:GPL) (FRA:G3U) re-starts operations at its Topia mine in Mexico following a voluntary COVID-19 related suspension O3 Mining Inc (CVE:OIII) (OTCMKTS:OQMGF) reports 'spectacular' drill assay from Simkar zone at its Alpha property in Québec Fury Gold Mines Ltd (TSE:FURY) (NYSEAMERICAN:FURY) (FRA:AUN1) eyeing drilling at large new gold targets on the Éléonore South joint venture next summer XPhyto Therapeutics Corp (CSE:XPHY) (OTCQB:XPHYF (FSE:4XT) and German partner complete successful validation of their COVID-19 RT-PCR test system BevCanna Enterprises Inc (CSE:BEV) (QTCQB:BVNNF) (FRA:7BC) expects acquisition of Naturo Group to close on or before January 20, 2021 Zynerba Pharmaceuticals Inc (NASDAQ:ZYNE) (FRA:6ZY) meets with FDA as development of its Fragile X syndrome program using Zygel advances Royal Road Minerals Limited (CVE:RYR) (OTCMKTS:RRDMF) (FRA:RLU) enters into binding Letter of Intent to sell its interest in the Luna Roja project in Nicaragua Pacton Gold Inc (CVE:PAC) (OTCPINK:PACXF) (FRA:2NKM) brings in over C$3.6M after closing oversubscribed financing Water Tower Research taps Wall Street veteran Stuart Linde as CEO as it eyes rapid business development 9.42am: US stocks ahead The main indices on Wall Street have started Thursday’s session on the front foot as traders in New York eyed imminent economic relief in the form of a new stimulus bill from Washington DC. Shortly after the opening bell, the Dow Jones Industrial Average was up 0.55% at 30,319 while the S&P 500 climbed 0.59% to 3,722 and the Nasdaq rose 0.58% to 12,731. The market also seems to have mostly shrugged off the latest round of weekly jobless claims figures, which have risen to nearly a four-month high. The number of Americans filing for unemployment in the week to December 12 climbed to 885,000, higher than the revised figure of 862,000 and well above analyst forecasts of a fall to 818,000. Surging cases of COVID-19, new lockdown restrictions across multiple states and a lack of new stimulus from the federal government appear to be hitting the US economy hard. While continuing jobless claims fell by 273,000 to 5.51 million in the week to December 5, part of this decline merely reflects jobless citizens exhausting state benefits and shifting to the temporary federal jobless programme, meaning there could be a high risk of long-term unemployment. For some analysts, the increase also points to worse to come in the new year. “The key number in all these reports is the increase in initial jobless claims, which looks bad but is even worse than it seems. That’s because seasonal pressures pointed to a clear drop in claims this week, so the increase suggests that the underlying trend is now rising rapidly, as Covid restrictions force services sector businesses to reduce staff numbers. The seasonals point to little change in claims next week but then a big increase through the year-end into early January, with claims likely to head comfortably over the million mark, last seen in late August; we look for 1.25M in the first full week of January”, said analysts at Pantheon Macroeconomics. “Continuing claims have now flattened and will follow initial claims back up. The path of Covid and the state of the economy cannot be separated”, they added. 8.00am: Wall Street to open higher as stimulus optimism persists US stocks are expected to open on the front foot as traders continue to expect politicians to come to an accommodation over a US$900bn fiscal stimulus package. Spread betting quotes suggest that the Dow Jones Industrial Average, which lost ground yesterday, will rise 137 points to open at around 30,292. The S&P 500 is expected to advance 20 points to 3,721 and the Nasdaq Composite is tipped to rise 63 points to 12,721. “Stimulus talks in Washington DC have made significant progress and markets are already pricing in a deal by year-end,” ventured Milan Cutkovic, a market analyst at Axi. “The pressure to reach a deal is rising on both parties as the US economy could be sliding into another recession, and investors remain optimistic that another aid package is just around the corner. “No surprises from yesterday’s FOMC meeting, where central bank once again confirmed that rates are likely to stay near zero until late 2023, and stressed the need for further fiscal support. “The US Fed revised its economic outlook slightly higher, but significant risks remain in the short-term. While the vaccine development is great news, it is clear that it will take time for life to return to some form of normality; however, the mood on Wall Street remained upbeat,” he added. Rabobank said that if recent indications from US initial jobless claims and payrolls data were not convincing enough, “yesterday’s release of November retail sales data provided further evidence that the pace of the US economy has been slowing”. “While the US economic outlook will be lifted by policy support, the headwinds are strong. Covid-19 related hospitalisations continue to hit record highs necessitating various restrictions around the country. The Fed’s two-day policy meeting ended last night with Chair Powell stating that the case for further fiscal policy was ‘very, very strong’, noted Rabobank. On the economic front today, the US has housing starts data, where a modest decline is expected for November. Traders will also be keeping an eye out for the Philadelphia Fed’s manufacturing survey for December and the weekly jobless claims. Four things to watch for on Thursday: A few famous names on the earnings calendar today, with second quarter figures expected from parcel delivery giant FedEx Corp (NYSE:FDX) Also in the diary are first quarter earnings from accountancy and consulting services firm Accenture PLC (NYSE:ACN), as well as second quarter numbers from food firm General Mills Inc (NYSE:GIS) The macro diary will bring jobless claims figures for the week to 12 December, which are forecast to show a decrease to 818,000 from the prior week’s number of 853,000. Data is also due on housing starts and new building permits for November, with the former predicted to rise to an annualised pace of 1.535mln from 1.53mln in October, while the latter are expected to increase to 1.57mln from 1.54mln

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