Stocks Wrap Up the Holiday Shortened Session Higher…..

U.S. equities closed modestly higher in an abbreviated session to finish the holiday shortened week. The session turned out to be fairly quiet as yesterday’s headlines carried into today. Most of the attention today seemed to surround the uncertainty of the future of the fiscal relief and government spending bill passed by Congress earlier this week, as President Trump threatened to veto the measure, calling on lawmakers to increase the direct payments to households under the package. Focus on the vaccine front remained after Pfizer and BioNTech announced a deal to provide the U.S. government an additional 100 million doses of its serum, while Merck & Co. also reached an agreement with the government on the manufacture and supply of its COVID-19 therapeutic. Treasuries were higher, pressuring bond yields and the U.S. dollar ticked to the downside amid a dormant economic calendar, while crude oil prices were modestly higher and gold edged higher. Asia finished with most bourses in the green, and markets that were open in Europe finished mostly higher ahead of the announcement that the U.K. and European Union have struck a historic trade deal.

The Dow Jones Industrial Average rose 70 points (0.2%) to 30,200, the S&P 500 Index was up 13 points (0.4%) at 3,703, and the Nasdaq Composite advanced 34 points (0.3%) to 12,805. In light volume, 381 million shares were traded on the NYSE and 3.2 billion shares changed hands on the Nasdaq. WTI crude oil was $0.09 lower at $48.21 per barrel and wholesale gasoline was unchanged at $1.37 per gallon. Elsewhere, the Bloomberg gold spot price added $6.77 to $1,879.66 per ounce, and the Dollar Index—a comparison of the U.S. dollar to six major world currencies—decreased 0.1% to 90.30. Markets were mixed for the week, as the DJIA rose 0.1%, the S&P 500 declined 0.2%, and the Nasdaq Composite increased 0.4%.

The economic calendar was dormant today following a slew of mixed reports this week. Highlights of the docket this week included the final look (of three) at Q3 Gross Domestic Product (GDP) being favorably revised to a quarter-over-quarter (q/q) annualized rate of expansion of 33.4%, above forecasts, as well as an upward adjustment to the personal consumption of the report. Weekly initial jobless claims moderated, welcome news after the figure had been edging higher the past few weeks. Consumer Confidence declined more than expected this month, with the labor differential—consumers’ appraisal of jobs being “plentiful” minus being “hard to get”—falling into negative territory, and the December final University of Michigan Consumer Sentiment Index was revised lower, but it was still an increase from November’s reading. On the other side of the ledger, personal income and spending figures fell well short of expectations and preliminary durable goods orders for November were mixed, while housing reports, which has been one of the bright spots of the economy during the pandemic, disappointed, with existing home sales posting its first decline in six months and new home sales hitting the lowest level since June.

Next week will be shortened by the New Year’s holiday, and the economic docket will be far less busy, but there are some items that could garner attention. More housing data is slated for release in the form of pending home sales and the S&P CoreLogic Case-Shiller Home Price Index, as well as weekly MBA Mortgage Applications. The first look at wholesale inventories is also on tap, as well as weekly initial jobless claims for the week ended December 26. Lastly, the Dallas Fed Manufacturing Index and the Chicago PMI will put the finishing touches on regional manufacturing data for the month.

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