Optimism over a new stimulus bill and positive developments with COVID-19 vaccines have helped stocks hold up well in the face of worsening COVID-19 trends and weakening jobs data.
Some very high-profile initial public offering (IPO) have occurred this year, and many have soared. Last week Airbnb and DoorDash both delivered spectacular gains. Is this 1999? These are real companies that are making money, but it’s also another sign that sentiment is stretched and is very one-sided.
COVID-19 vaccine news
The Pfizer-BioNtech COVID-19 vaccine was authorized by the US Food and Drug Administration for emergency use, while Moderna’s vaccine is widely expected to be approved as well. However, some other COVID-19 vaccines hit stumbling blocks last week. The LPL strategists discuss the good and bad news but still expect an end to this pandemic in 2021.
Will Santa deliver gains again this year?
Most people know that stocks do well in December, but what most don’t realize is the gains happen late in the month. Although sentiment is frothy, the LPL strategists still think Santa may come and stocks could have one more surge into the end of the year. But going forward, the high level of enthusiasm may be a contrarian warning sign.
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All index data is from FactSet.
All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.
This Research material was prepared by LPL Financial, LLC.
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