U.S. Treasury yields fell from high levels, easing market concerns about inflation. U.S. stocks rose on Monday (1st). The Dow Jones industry average rose nearly 500 points, or 1.6 percent, the Nasdaq index rose 1.4 percent, and the S&P 500 index rose 1.4 percent and fees rose 0.9 percent.
U.S. Treasury yields fell on Monday. Last month, due to the expected economic recovery that will boost inflation, the 10-year U.S. Treasury yield once reached a one-year high and fell to 1.432% on Monday.
Many Fed officials so far have said that yield growth largely reflects people’s expectations that the vaccination program will spur economic recovery and additional fiscal stimulus measures. The $ 1.9 trillion bailout bill proposed by Biden in the House of Representatives last week is expected to be submitted to the Senate for a vote this week.
There are also positive developments in the news of the new crown vaccine. The U.S. Food and Drug Administration (FDA) approved approval on Saturday (27th) for emergency use of Johnson’s single-dose vaccine, and the U.S. Centers for Disease Control and Prevention (CDC) quickly approved the use of Johnson’s vaccine the next day. Johnson & Johnson plans to provide 20 million doses of the vaccine by the end of March, with vaccination starting as early as the next few weeks.
Shares for cruises, airlines and hotels rose mostly on Monday. Carnival (CCL-US) opened 2.5%, Norwegian Cruise Line (NCLH-US) rose 3.6%, American Airlines (AAL-US) rose 4.4%, Delta Air Lines (DAL-US) rose 3.9% and the Hilton Group (HLT-US) rose 1.4%.
The Supply Management Institute (ISM) will announce PMI for production in the United States later in February, and U.S. factory activity is expected to record strong growth.
From Monday (1.) 22:00, Taipei time:
- The Dow Jones index temporarily rose 499.29 points, or 1.61%, to 31,431.66
- Nasdaq temporarily increased by 186.33 points, or 1.41%, to 13278.68 points
- The S&P 500 index temporarily rose 54.81 points or 1.44%, to 3,865.96
- Fees and a half increased by 26.13 points or 0.85%, temporarily to 3.09.75 points
- TSMC ADR is up 1.59% at $ 127.94 per share
- Ten-year US Treasury yield drops to 1.432%
- Light crude oil in New York rose 0.11% to $ 61.57 a barrel
- Brent crude fell 0.08% to $ 66.08 a barrel
- Gold rose 0.49% to $ 1,737.20 an ounce
- The US dollar index rose 0.11% to 90.98 points
Johnson & Johnson (JNJ-US) rose 1.44% to $ 160.74 in early trading.
The U.S. Food and Drug Administration (FDA) officially approved approval for the emergency use of the Johnson vaccine on Saturday (the 27th), and the CDC subsequently approved it as the third new crown vaccine approved for use in the United States. According to clinical trials on three continents, the protection of Johnson’s vaccine is 85%.
Berkshire Hathaway (BRK-US) rose 2.70% in early trading to $ 247.00.
Berkshire, Warren Buffett’s holding company, announced on Thursday its fourth quarter of 2020 and year-round earnings. Thanks to U.S. stock growth, fourth-quarter net income increased nearly 23% year-over-year to $ 35.83 billion. Berkshire executed $ 24.7 billion in treasury shares in 2020, including $ 9 billion in Q4. The number of treasury shares for the whole year is equivalent to 5.2% of the number of issued shares, which is a record high.
Twilio (TWLO-US) rose 4.32% in early trading to $ 409.84.
According to people familiar with the matter, cloud-based communications service provider Twilio plans to invest $ 750 million in wireless communications technology and service provider Syniverse Technologies to pave the way for Syniverse’s SPAC list. The investment case is expected to be announced on Monday.
Key daily economic data:
- At 22:45, Taipei time, the American Markit will be announced for the production of Markit in February, which should be 58.5 and the previous value 58.5.
- At 23:00, Taipei time, the US manufacturing PMI for February in the ISM will be announced, which should be 58.7 and the previous value 58.7
- At 23:00 Taipei time, the monthly growth rate of construction expenditures in the United States in January will be announced, which is expected to be 0.7% and the previous value 1.0%
Wall Street Analysis:
Threadneedle Investments fund manager Andrea Carzana believes progress this week is very important. If the Fed does not try to lower market inflation expectations, bond yields could continue to rise and shake the stock market.
National Securities Market Strategist Art Hogan said concerns about yield increases would eventually subside, and interest rates will clearly calm down. At the same time, optimistic news about vaccines and rescue cases will provide support to the market, which is good news for both the economy as a whole and for corporate profits.