Wall Street shares lack clear direction by year’s end, strong returns for indices in 2021: “An exceptional year”


New York

The main indices of the US stock market closed inconsistently on Friday, New Year’s Eve and the last trading day of the year.

The Dow Jones index rose 19 percent this year, the S&P 500 index 27 percent and the Nasdaq index 22 percent. All three stock indices have risen for three years in a row.

The monetary policy of the US Federal Reserve will be tightened this year as the central bank significantly accelerates the reduction of its subsidy purchase programs. With these prospects, the bank’s support purchase programs will end as early as March, although the original plan was not to end the purchase programs until June.

In addition, central bankers are proposing three rate hikes for next year, two rate hikes for 2023 and two rate hikes for 2024. This is a much faster forecast for interest rate hikes compared to previous forecasts by members of the Open Market Committee.

“2021 was another exceptional year for the U.S. stock market,” Chris Haverland Wells Fargo Investment Institutelta writes according to CNBC.

“The market was supported by highly stimulative economic and monetary policies.”

Strong results also supported the rise in shares. Analysts evaluate the analysis service Factsetin according to that the results for 2021 will increase by an average of 45.1 percent from the previous year. This would mean the fastest earnings growth rate since 2008.

Shares in the energy sector and shares in the real estate sector have performed best among the industries in the S&P 500 index this year. About the Dow Index Home Depot and Microsoft have tilted the most. Home Depot closed up 1.5 percent on Friday. It rose 57 percent in 2021. Microsoft closed down by half a percent. The stock rose 52 percent in 2021.

Shares have risen despite the continuing interest rate pandemic. In the United States, more than 53 million coronary infections and more than 820,000 deaths from coronary infections have been reported.

The euro strengthened against the US dollar after the stock markets closed. The 10-year rate on U.S. government debt rose 1.514 percent after the stock markets closed.

The Dow Jones index rose 0.2 percent, the S&P 500 index 0.1 percent and the Nasdaq index fell 0.3 percent.


Source: Arvopaperi by www.arvopaperi.fi.

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