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Investors will get key economic data on Friday morning when the Department of Labor releases its monthly job report for December. Economists polled by Dow Jones had expected a meager 50,000 jobs growth over the period, but some fear the report may actually show a net loss of jobs after many areas re-introduced economic restrictions to slow the spread of the pandemic.
Stocks started the new year slump on Monday, but the market has risen since then despite the turmoil in Washington, where a riot in the Capitol on Wednesday delayed the procedural confirmation of President-elect Joe Biden’s victory by Congress. The Dow and S&P 500 have had three-day winning streaks.
This week, Democrats also won two key Senate races in Georgia, according to NBC News forecasts, raising hopes on Wall Street for more fiscal stimulus.
On Thursday evening, President Donald Trump first admitted that a new government would take power on January 20th.
Fundstrat’s Tom Lee told Closing Bell that growing clarity in Washington and the amount of cash on the sidelines could drive stocks higher, with cyclical stocks in particular benefiting.
“If we just look at the first few days of this year, the lead has come from things like energy and cyclicals, including financials and industrials, or even discretion without Amazon. I think that’s kind of a forerunner to what all this Year will look like. ” like, “said Lee.
The strategist also said stocks “could take a really big step” in the coming weeks as market fear subsides.
Gary Schlossberg, a global strategist at the Wells Fargo Investment Institute, said recent market moves could be fueled by growth in corporate earnings this year.
“We believe that some of the optimism will translate into improved earnings growth to some extent, and the market may have been taking some of that into account lately, but we still believe that this will bring additional miles to the market,” said Schlossberg .
In addition to the new job report, investors will receive new wholesale inventory and consumer credit data on Friday to better show the path of economic recovery.
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