Before The Bell
The old adage of "Beware the Ides of March" likely will not be in vogue today, at least on the Dow Jones Industrial Average, as that index has started the new week and day off to the upside, quickly gaining a solid 135 points to yet another all-time high in the first few minutes of trading. The tech-heavy NASDAQ was little changed, however, as relative weakness in that composite seems to be persisting.
Meanwhile, this will be a busy week for economic releases with key data on retail sales and industrial production scheduled for issuance tomorrow morning. Then, on Wednesday, the government will issue its February metrics on housing starts and building permits, while the Federal Reserve will end its two-day FOMC meeting. No change in interest rates is expected, with the accompanying monetary statement likely to advocate continued support for the economy in the form of ongoing accommodation.
As for the stock market, equities continue to rally on optimism about COVID-19 vaccines, with three different offerings now available to an increasing number of U.S. adults. Meantime, stocks that figure to benefit most from an economic comeback, such as industrials, some retailers, and the airlines are likely to continue to lead the way higher in dealings today and in the days to come.
Also contributing to the optimism on Wall Street was the signing into law by President Biden of the massive $1.9 trillion stimulus and relief package passed by both houses of Congress last week. The IRS started processing the $1,400 direct payments shortly thereafter.
Finally, one concern for the market has been the sharp rise in Treasury note and bond yields. In all, the 10-year note's yield has quadrupled over the past year surging from 0.40% to more than 1.60% on inflation fears. These yields are little changed this morning, which also may be helping stocks.
– Harvey S. Katz, CFA
At the time of this article's writing, the author did not have positions in any of the companies mentioned.
