Tech and communication services continue to push higher on strong reporting. Intel, IBM, Seagate all beat earnings expectations. We are seeing a switch towards these sectors for the moment as investors and traders race to get exposure to the up and coming reporting. Value stocks that are tied to the economic recovery are not necessarily bearish right now but are giving a little back.
Biden brings stability in the US as he signs orders to start to get the virus under control via mask-wearing and vaccine distribution. We expect this momentum to continue with more stimulus to come and further policies aimed at repairing relationships and trade agreements.
Another 1.9 billion in US COVID-19 aid is one of many things Joe Biden and his team will be pushing for in the coming months. Once again it is all about stimulus in the current market. How this plays out in the coming months will affect sentiment. A stimulus package this big will be difficult to pass the Senate even though they have a slight majority.
Our market is set for a flat open this morning, with little leads from the U.S last night and their futures this morning. We broke fresh post-fall highs yesterday, and today’s breather could see us potentially test the previous key resistance near 6750 (now support) if U,S futures move harder into the red.
We maintained our strength yesterday, holding the gains which were largely set on open. Hopefully this gives confidence for further gains now that the channel is broken. The next target is around 6900.
The AUD rallied against the USD last overnight which will put pressure on our miners and some of our key players like CSL and MQG.
US markets closed fairly flat overnight, with markets trading in very narrow ranges throughout the session. A bit of a breather was unsurprising given the strong sessions enjoyed on Tuesday and Wednesday. Intel, IBM, and several other major stocks reported better than expected earnings overnight, with very few earnings misses; this earnings season is progressing like most of those previous, with a vast majority of companies reporting better than expected results.
After the strong results from Intel and IBM, Technology was the strongest performing sector overnight. Every other major sector closed lower to some degree, with Oil & Gas the weakest. US economic data was largely positive overnight, with Jobless Claims, Housing Starts, and Building permits better than expected.