On Wednesday, all three key indices of Wall Street had witnessed an upsized caution from the investors as trade-sensitive Dow alongside benchmark S&P 500 eked out marginal gains and tech-heavy Nasdaq winded up the session in red inks.
In point of fact, Wednesday’s gains in the Wall Street were largely prompted by a strong investors’ response to Google-parent Alphabet Inc’s robust quarterly earnings’ result, while an ease-off of recent market volatility, led by a number of rogue retail traders in the Main Street, coupled with a cascade of upbeat economic data seemingly had guarded the US money markets, suggested analysts.
On top of that, as US President Joe Biden had held a conference call with Democratic lawmakers in the House of Representatives and had spoken with a number of Democratic Senators in the Oval Office earlier in the day over a proposed $1.9 trillion in additional pandemic stimulus bill, investors appeared to be trying to shake off the impacts stemming from a latest round of slugfest between a group of Main Street retail traders and Wall Street’s institutional investors.
Wall Street inches higher despite upbeat data as investors’ caution intensifies
Apart from that, US Labour Department said in a statement earlier in the day that the US employers had added 174,000 jobs last month, insanely beating a Wall Street estimate of a gain of 49,000, while a survey data from ISM (Institute of Supply Management) had revealed that the US service sectors activities surged to a nearly two-year trough last month, unleashing a latest sign of economic recovery from a pandemic-propelled fiscal slump.
However, despite a deluge of upbeat data alongside optimisms over latest progress on another trillion-dollar stimulus bill, market participants had shown a sheer reluctance to open up new “buying” positions over frets that Wall Street might be facing off an inflection point in light of latest volatilities that meaded out of a Reddit stock discussion thread “WallStreetBets”.
Citing statistics, in the day’s Wall Street round off, trade-sensitive Dow added 0.12 per cent to 30,723.60 and S&P 500 rose 0.10 per cent to 3,830.17, while tech-heavy Nasdaq fell 0.02 per cent to 13,610.54. Meanwhile, expressing concerns over another round of war between the Main Street retail traders and Wall Street’s institutional investors following media speculations that a number of hedge funds had opened up short-sell positions earlier in the day, a chief market strategist at JonesTrading in Stamford, Connecticut, Michael O’Rourke said, “Recent retail trading activity is likely to be here for a while.
I don’t know if it’s going to be here with the same intensity ... It’s hard to maintain that type of intensity. What we’ll probably see are coordinated movements in individual names by that crowd”.