06.07.202112:55 Forex-elemzések és áttekintések: Overview of the US market (07/06/2021)

US stocks posted strong gains last week, where major indices not only reached all-time highs, but also gained new record values. Dow Jones lagged slightly behind the other indices, but held near yearly highs.

Last week:

Dow Jones was up 1.5% (550 points) and ranged from 34.240 to 34.790 points.

S&P 500 grew 1.5% (60 points) and valued 4.290 to 4.350 points.

Nasdaq rose 1.0% (149 points) and fluctuated from 14.490 points to 14.639 points.

Market condition: Obviously, the trend is upwards, thanks to the strong recovery of the US economy. Latest data says it climbed 6% year-on-year and should continue moving away from the coronavirus crisis. In fact, the Federal Reserve predicts another 6% growth by the end of 2021.

Strong vaccination programs have also pushed COVID-19 cases down to non-hazardous levels. As a result, different sectors of the economy improved, such as the labor market. Latest reports say wages and incomes have increased.

There is also a consumer boom in the United States, especially on homes and cars. But inflation continues to surge in the country, as prices increased again by about 5%.

Yet, the Fed continues to ignore the issue and announced that they will resume injecting liquidity of around $ 120 billion, and maintain a near-zero interest rates (+ 0.125%). But if inflation does not slow in the coming months, the central bank will be forced to take action, which will trigger a huge correction in all stock markets.

Forecasts for this week:

Dow Jones will value around 34.000 - 35.600 points;

S&P 500 will range around 4.270 - 4.1410 points;

Nasdaq will hit 14.300 - 14.900 points.