U.S. markets and stock exchange traded funds continued to push higher on Friday and were on pace to wrap up their best week since the presidential elections, as optimism over another stimulus package helped lift the mood.
On Friday, the Invesco QQQ Trust (NASDAQ: QQQ) rose 0.5%, SPDR Dow Jones Industrial Average ETF (NYSEArca: DIA) was up 0.3%, and iShares Core S&P 500 ETF (NYSEArca: IVV) gained 0.5%.
Progress on a new stimulus, upbeat earnings and vaccine rollouts have added to bets of an economic rebound, putting the S&P 500 and the Nasdaq on pace for their best week since the U.S. elections in early November, Reuters reports.
While the Labor Department’s latest data revealed job losses in manufacturing and construction, the two areas that have been previously supporting the economy, the weakness only fueled calls for increased stimulus to shore up the economy.
“That would be a huge boost to the economy.” Edward Smith, head of asset allocation research at Rathbone Investment Management, told the Wall Street Journal. “It certainly reduces any short term risk as we wait for the vaccine rollout to get fully up to speed.”
President Joe Biden’s plans to add push out a $1.9 trillion coronavirus aid bill gained traction on Friday as the House of Representatives was set to vote on a budget plan that would lay the groundwork for the bill in coming weeks without Republican support.
“Today’s payrolls number gives further momentum behind a large stimulus package … on top of that you have equity earnings which continue to get revised up for the fourth quarter,” Jon Adams, senior investment strategist and portfolio manager at BMO Global Asset Management, told Reuters.
The better-than-expected corporate earnings season so far has helped upgrade analysts’ expectations, with the S&P 500 now on track to post earnings growth of 2.4% for the quarter.
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