Stock Market Update: Wednesday, Dec. 30, 2020
Wall Street rebounded despite diminishing hopes for $2,000 stimulus checks as focus turned back to the improved outlook for 2021 amid the vaccine roll out — and more in Wednesday’s stock market update.
Volatility traded in a tighter range as overall stock market volume remained thin heading into the New Year’s holiday Friday.
Stock Market Update
The Russell 2000 rallied 1.1% after tapping a high of 1,987 shortly after the opening bell.
The Nasdaq added 0.2% with the morning peak reaching 12,924.
The Dow also gained 0.2% following the intraday trip to 30,525.
The S&P 500 nudged up 0.1% after trading to an opening high of 3,744.
Energy and Materials were the strongest sectors with gains of 1.6% and 1.4%, respectively. Communication Services and Consumer Staples paced sector laggards after falling 0.7% and 0.1%.
Stock Market Movers
Ryerson Holding Corp. (NYSE: RYI) zoomed nearly 17% on a technical breakout with shares trading to a fresh 52-week peak of $13.84.
Stock Market Outlook
The percentage of Nasdaq 100 stocks trading above the 50-day moving closed at 89.32%, up 2.92%. Near-term and lower resistance at 87.5%-90% was recovered. A move above the latter would indicate a retest towards 92.5%-95% and overbought levels from mid-July. Support is at 85%-82.5%.
The percentage of S&P 500 stocks trading above the 200-day moving average settled at 89.70%, up 0.40%. Key resistance at 90% was cleared but held. A close above this level keeps upside towards 92.5%-95%. Support is at 87.5%-85%.
Global Economy
European markets closed lower after UK lawmakers signed off on last week’s Brexit deal.
The UK’s FTSE 100 fell 0.7% while Germany’s DAX 30 and the Stoxx 600 were down 0.3%. The Belgium20 and France’s CAC 40 slipped 0.2%.
Asian markets settled on both sides of the ledger.
Japan’s Nikkei fell 0.5% and Australia’s S&P/ASX 200 was down 0.3%. Hong Kong’s Hang Seng surged 2.1% and South Korea’s Kospi soared 1.9%. China’s Shanghai jumped 1.1%.
U.S. Economy
Advance trade deficit widened further to a record -$84.8 billion in November after expanding to -$80.4 billion in October. Imports rose 2.6% to $212 billion after increasing to $206.6 billion previously. Exports edged up 0.8% to $127.2 billion following October’s pop to $126.2 billion. Advance wholesale inventories dipped -0.1% to $649 billion versus the prior 1.2% rise to $649.4 billion in October. Advance retail inventories were up 0.7% to $616.9 billion following the prior 0.9% climb to $612.7 billion.
Stock Market Sentiment
The iShares 20+ Year Treasury Bond ETF (Nasdaq: TLT) was up for the third time in four sessions with the late-day peak reaching $157.53. Current and lower resistance at $157.50-$158 was recovered. A close above the latter and the 50-day moving average would suggest additional strength towards $159-$159.50.
Support is at $156.50-$156.
Volatility Index
The iPath S&P Vix Short-Term Futures (NYSEArca: VIX) traded in a tight range with the morning low tapping 22.41. Current and upper support at 22.50-22 was breached but held. A close below the latter would suggest another retest towards 21-20.50.
Resistance remains at 23.50-24.
Stock Market Analysis
The SPDR Small-Cap 600 ETF (NYSE: SLY) rebounded following the first-half run to $79.83. Near-term and lower resistance at $79.50-$80 was breached but held. A close above the $80.50 level and Monday’s all-time high at $80.58 would signal additional momentum towards the $81.50-$82 area.
Support is at $79-$78.50 followed by $77.50-$77.
RSI (relative strength indicator) is back in an uptrend after clearing and holding lower resistance at 65-70. A close above the latter would indicate additional strength towards 75 and the late-November peak. Key support is at 60, a level that has held since mid-November.
Sector
The Energy Select Sector SPDR Fund (NYSE: XLE) remains in a seven-session trading range with the intraday high reaching $38.58. Near-term and lower resistance at $38.50-$39 was cleared but held. A close above the latter would suggest additional strength towards $40-$40.50.
Support is at $37.50-$37. A move below the latter and the bottom of the trading range would signal a further pullback towards $36.50-$36.
RSI is in a slight uptrend with lower resistance at 50-55 getting cleared and holding. A close above the latter would signal strength towards 60-65. Support is at 45-40 and levels from early November on a close back below the 50 level.
Check back after the closing bell for the most important news and numbers in the WealthPress stock market update.