U.S. Stocks Poised To Extend New Year’s Rally

U.S. Stocks Poised To Extend New Year’s Rally

January 12, 2022

Following the notable advance seen in the previous session, stocks are likely to see further upside in early trading on Tuesday. The major index futures are currently pointing to a higher open for the markets, with the Dow futures up by 144 points.

The strong upward move shown by stocks in 2021 has carried over into the New Year, with the Dow and the S&P 500 ending Monday’s trading at new record closing highs.

Traders continue to express optimism about the economic outlook even as the U.S. reported a record number of new Covid cases on Monday, with new infections surging above 1 million.

Indications the new Omicron variant causes milder symptoms has led to hopes the recent surge could actually help to accelerate the end of the pandemic.

Analysts expect 2022 to be another strong year for stocks even as the Federal Reserve prepares to wrap up its asset purchase program and begin raising interest rates.

Shortly after the start of trading, the Institute for Supply Management is scheduled to release its report on manufacturing activity in the month of December.

The ISM’s manufacturing PMI is expected to dip to 60.2 in December from 61.1 in November, although a reading above 50 would indicate continued growth in the sector.

The Labor Department is also due to release the results of its Job Openings and Labor Turnover Survey for November. Job openings are expected to inch up to 11.06 million.

Stocks moved mostly higher during the first trading session of the New Year on Monday amid optimism the economy will stay on the recovery track despite the surge in coronavirus cases in several parts of the globe.

The major averages all ended with solid gains. The Dow climbed 246.76 points or 0.7 percent to 36,585.06, a record closing high. The S&P 500, which also set a fresh closing high of 4,796.56, gained 30.38 points or 0.6 percent, while the Nasdaq jumped up 187.83 points or 1.2 percent to 15,832.80.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Tuesday. Japan’s Nikkei 225 Index jumped by 1.8 percent, while Australia’s S&P/ASX 200 Index surged by 2 percent.

The major European markets have also shown strong moves to the upside on the day. While the German DAX Index has advanced by 0.9 percent, the French CAC 40 Index and the U.K.’s FTSE 100 Index are jumping by 1.4 percent and 1.5 percent, respectively.

In commodities trading, crude oil futures are rising $0.76 to $76.84 a barrel after climbing $0.87 to $76.08 a barrel on Monday. Meanwhile, after plunging $28.50 to $1,800.10 an ounce in the previous session, gold futures are inching up $3.10 to $1,803.20 an ounce.

On the currency front, the U.S. dollar is trading at 116.32 yen compared to the 115.32 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.1281 compared to yesterday’s $1.1297.

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