VOO Stock – Stimulus Hopes Keep U.S. Stock ETFs Going
U.S. markets and stock exchange traded funds regained lost ground and turned higher Thursday as investors looked to more fiscal stimulus in support an economy weakened by the coronavirus pandemic.
U.S. House Speaker Nancy Pelosi hinted at progress in talks with the Trump administration in another round of financial aid and announced that a new stimulus bill could come out “pretty soon,” Reuters reports.
Pelosi and Treasury Secretary Steven Mnuchin have been negotiating the finer details of a near $2 trillion relief package, which some Senate Republicans have expressed concern over due to the expanding federal deficit.
“The market remains highly sensitive to a fiscal stimulus deal,” Rob Haworth, senior investment strategist at U.S. Bank Wealth Management, told Reuters. “What we’re concerned about is the labor market as we move to the next couple of months. We get the roll-off of the stimulus and the labor market remains suspect. That’s why we’re looking for fiscal stimulus and the market is looking for fiscal stimulus.”
Further adding to the positive mood, data revealed the number of Americans filing for state unemployment benefits last week slipped to a more than expected 787,000, but the numbers remained stubbornly high, fueling hopes of support from fiscal stimulus.
Looking ahead, investors will be watching out for the final presidential debate Thursday night where President Donald Trump will take on Democratic challenger Joe Biden, who is leading in national polls.
“It would seem likely whoever wins that there’ll be some form of fiscal stimulus in the next few months,” Tristan Hanson, multiasset fund manager at M&G Investments, told the Wall Street Journal. “That seems to be the mood music.”
The earnings season has so far been better than expected. About a fifth of S&P 500 companies have reported third-quarter results so far, with 84.1% beating earnings estimates, according to IBES Refinitiv data.
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