By
Steve Muchoki
April 16th, 2024
Ahead of Thanksgiving Day 2021, US stocks indices are showing early signs of optimism and market futures surge northwards on Monday’s morning trade.
During the early morning trading on Monday, November 22, stock futures rose to strike a tone of optimism in the market. We are kickstarting the holiday-shortened week which has historically been a strong period on Wall Street.
Futures for the Dow Jones Industrial Average (INDEXDJX: .DJI) are up 120 points as of writing this story. Similarly, the Nasdaq Composite (INDEXNASDAQ: .IXIC) and the S&P 500 (INDEXSP: .INX) are currently trading in the positive territory. On upcoming Thursday, November 25, the US markets will remain closed. furthermore, the following day of Friday the market will close early at 1 PM ET.
As CNBC notes: “Stocks have a track record of posting gains in Thanksgiving week, which will potentially set the stage for a year-end Santa rally.”
Sam Stovall, chief investment strategist at CFRA also makes an interesting observation. Stovall adds that since 1950, the last five trading days of November have been traditionally positive. Also, there’s a 66% likelihood that the market will be up on the day before Thanksgiving Day.
The market is waiting for a key moment ahead this week. President Joe Biden is set to announce the nomination of the next chief of Federal Reserve. The most-likely candidates are current chairman Jerome Powell and Governor Lael Brainard.
Analysts said that if Brainard takes the seat, it will take much longer to tighten policies including increasing the interest rates.
Market Expectations ahead This Week
Market analysts are expecting the market to remain upbeat ahead this week. Jeff Schulze, ClearBridge Investments investment strategist told CNBC:
“I do think in the shortened week, that is probably going to be the biggest driver of market action. If Brainard is nominated as Fed chair, it wouldn’t be a surprise to me to see some near-term volatility. Usually, the market tests a Fed chair.”
Over the last week, the market remained tepid in one of the worst weekly performances after September. The dow Jones corrected nearly 1.5% losing more than 500 points.
However, the S&P 500 managed to sustain the tide and end in green on the weekly charts. Thanks to the strong US retail data and earnings reports from big retailers. On the other hand, the tech-heavy Nasdaq Composite also jumped 1.2% last week.