Stocks Hit Record as Biden Calls for More Stimulus

Stocks climbed to all-time highs after President-elect Joe Biden said he’ll lay out the details of trillions of dollars in further aid to revive the world’s largest economy. The S&P 500 rose by 0.55% to 3,824.68 while Dow Jones was up 56.84 points (0.18%) to 31,097.97.

Biden Demands Trillions in New Aid, Renews $2,000-checks Goal

President-elect Joe Biden called for trillions of dollars in immediate further fiscal support, including increased direct payments, after a surge in coronavirus cases caused US payrolls to drop for the first time since April. The price tag will be high, Biden said of his planned package. He promised to lay out his proposals next Thursday, before taking office on Jan. 20. “It will be in the trillions of dollars.”

Clarida Doesn’t See the Fed Paring Asset Purchases in 2021

Federal Reserve Vice Chair Richard Clarida said he doesn’t expect the central bank to begin tapering its asset purchases this year despite an expected strengthening of the economy as the pandemic fades. “My economic outlook is consistent with us keeping the current pace of purchases throughout the remainder of the year,” he said. Clarida allowed that his expectation for purchases could change if the economic outlook improved more than anticipated.

US Jobs Recovery Falters as Virus Surge Snaps Hiring Streak

The US labor market lost jobs in December for the first time in eight months, reflecting a plunge in restaurant employment that highlights how surging coronavirus infections are taking a greater toll on parts of the economy. Nonfarm payrolls decreased by 140,000 from the prior month, according to a Labor Department report that bucked economists’ forecasts for a modest gain. The unemployment rate held at 6.7%, halting a string of seven straight drops.

Canada Loses Jobs for First Time Since April on Covid Clampdown

The seven-month streak of gains in Canada’s labor market came to an end in December as health authorities tightened restrictions to curb a second-wave of Covid19 cases. Canada lost 62,600 jobs in the month, Statistics Canada said. The unemployment rate edged up to 8.6%, from 8.5% in November.

Germany’s Finance Minister Sees Economic Recovery, DPA Reports

German Finance Minister Olaf Scholz said a slight economic recovery is on the horizon thanks to robust state aid preventing much of the potential fallout of the pandemic. He credited Germany’s fiscal stimulus and the Berlin government’s shift on crisis aid at the EU level with saving jobs. Without state aid, the economic picture would be bleaker, Scholz said.

Slower Japan Household Spending Gains Hint at Weakness Ahead

Japan’s household spending held up better than expected in November, but slowing gains pointed to a weakening trend even before a recent surge in virus cases and this week’s declaration of emergency for Tokyo. Spending rose 1.1% compared with a year earlier, down from October’s 1.9% pace, the internal affairs ministry reported. Higher outlays on utilities were the biggest contributor to the gains as more people spent time at home.

Oil Has Best Week in Four Months With Saudi Cut Buoying Prices

Oil posted the biggest weekly gain since late September as Saudi Arabia’s plan to slice output spurred a surge in physical crude buying. Brent crude for March settlement rose US$1.61 to US$55.99 per barrel.

Source: Affin Hwang Research - 11 Jan 2021