US Stock Markets Ended Dec. 18, 2020

With a week until Christmas, the S&P 500 has returned 16.87% during the course of 2020. Last week, Information Technology and Consumer Discretionary stocks led the index while Energy and Communication Services lagged. Washington continues to be one of the main drivers of market action. As stocks hit record highs on Friday, talks broke down among lawmakers working towards another round of stimulus. To compound the intraday volatility, options and futures on indexes and equities expired which is known as a "quadruple witching". Monetary policy set by the Federal Reserve should continue on its "easy money" path after the Board of Governors voted to keep rates near zero on Wednesday. With a sign of confidence coming in late Friday, the Fed announced that banks will be able to buy back shares following a successful stress test. JPMorgan was one of the first banks to comment saying the bellwether plans to purchase up to $30 billion dollars' worth of shares in the first quarter of next year. In deal news, Alexion Pharmaceuticals is set to be acquired by AstraZeneca for a 40% premium to its previous close. AstraZeneca looks to diversify its business which focused on oncology into new areas such as immunology. Looking at stocks through the consumer and technology lens, Etsy, PayPal, and eBay were all top performers in the S&P 500. Next week, the Christmas holiday will have markets closed on Friday. The shortened week will have no shortage of economic data as GDP, home sales, and employment data are all set to be released.
Posted on Monday, December 21, 2020 @ 8:07 AM

These posts were prepared by First Trust Advisors L.P., and reflect the current opinion of the authors. They are based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice. This information does not constitute a solicitation or an offer to buy or sell any security.