On last Friday the U.S stocks closed at a significant level while the S&P 500 had its best winning strict since June 2014.On the other side, the Dow Jones Industrial average has a strong rally for the fifth consecutive weeks in the global market. The S&P 500 SPX, touched a historic high and added 13.34 points which resulted in 0.6% gain in the global market. Currently, the center of focus is the health care stocks and this centralized attention has caused a strong rally in the health care stocks. The U.S economy was shocked after the U.S presidential election on 8th November 2016 since the leading investors were not favoring Mr. Trump anti-social policy.
Despite that fact, there has more a strong rally in the S&P 500 which resulted in more than 5% gain in the market. The rally was supported by the higher fiscal spending and lower tax policies of the newly elected U.S president Donald Trump. The recent performance of the U.S economy is pretty good compared to the performance of the beginning of this year. However last two-week major fundamental news releases were not that satisfactory and investor’s world is at fear since FED is yet stated their interest rate hike decision of 14th of December, 2016.
There has been strong gained in the DOW Jones Industrial Average DJIA for about 0.75 or 142.04 points. This secured a record close of 19,756.85 level in the financial market. The Nasdaq composite index also gained significant amount and it rose 27.14 points or 0.5, closing at a high of 5444.50 level in the market. During the intraday session all the major three index touch new highs with 3.1% gain in S&P 500 and 3.6 % gain for Nasdaq.Currently, the market is now closing toward the ending of the year 2016 and investors are not surprised with such a dramatic gain since the month of December always offers unexpected events to the trader’s community.
The bull marathon of the dollar has been started after the victory of Donald Trump in the presidential election. His speech regarding the expansion policy of fiscal spending and lower tax has created a massive positive impact on the mind of U.S consumer. However, the leading economist strongly doubt about the recent performance of the U.S economy as the market has a strong tendency to buy the rumor and sell the fact. World-leading organizations like Group GS, +0.17% and J.P Morgan Chase & Co. JPM, +0.43% doubled their digits on the event of major fundamental events in the global economy. This the strongest surge in the stock price since the month of January 2016.
The U.S stock market has strongly rallied over the last few weeks. Currently, the market growth has slowed down to a certain extent as the FOMC meeting minutes is getting closer. The RSI indicator (Relative Strength Index) clearly indicates that the stock market is now in the overbought region and the market might fall down at the time without any prior notice. Though the fundamental factors are still suggesting that the gain will last long in the market but the technical sectors can never be overlooked in the economy. If the FED comes up with a hawkish hike in the month of December then we might see a crash in the stock market and the bulls rally will come to an end. However, if the FED hike their interest rate in this upcoming FOMC meeting minute then the FED member have to go for an another rate hike in the year 2017 to retain the strength of the U.S dollar in the global economy. But raising the interest for two consecutive years will be extremely difficult for the FED members since the economic performance needs to be extremely great for promoting such an event in the financial sectors.
Popular stocks like Coca-Cola, KO, +2.49 % gained more than 2.5% in the market after the announcement of the Muhtar Kent resignation from his current role of chief executive. There has been also strong rally in Broadcom Ltd,AVGO,+4.91% in the global market and this rally is considered to be the strongest rally for the year 2016.Since the holiday sales data has been slowed down to a great extent in the market Restorations Hardware Holding Inc RH,-18.13% dropped more than 18% in the market. On the other hand, there has been a relatively stable condition in the energy field after OPEC decided to cut the oil production in their last meeting. The price of oil traded higher on the last Thursday and investors are cautiously waiting for the final agreement decisions from the meeting of OPEC and Non-OPEC members regarding this ongoing issue of the energy market.
The financial world is now closing towards the end of the year 2016 and professional traders are cautiously waiting for the rate hike decisions of the FED.There has been massive ups and down in the financial industry from the very beginning of 2016 as lots of important fundamental decisions were pending. The first major shock was the Brexit events and currently the world is waiting for the FOMC meeting minutes to get a clear overview of the next movement of the stock and forex market. Some of the investors are overly sure that the FED will hike their interest rate in December 14 FOMC meeting minutes but the conservative far-sighted traders are worried about the economic effect for a such a heavy impact news in the global community.