New York Stock Market Dilutes Reddit’s Overheated Concerns … Dow closes 1.57%



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(New York = Yonhap News) Jinwoo Oh, Yonhap Infomax correspondent = Major indices in the New York stock market rose as concerns about overheating of some stocks, such as stoppage of play, eased.

In the second (US time) on the New York Stock Exchange (NYSE), the Dow Jones 30 industrial average closed at 30,687.48, 475.57 points (1.57%) more than on the battlefield.

The Standard & Poor’s (S&P) 500 Index increased 52.45 points (1.39%) from the previous length to 3,826.31, while the NASDAQ index oriented to technology stocks closed at 13,612.78, an increase of 209.38 points (1.56%).

The market looked at share price trends for some stocks like Gamestop, top corporate results, and the state of US stimulus measures.

The ‘stop the game’ phenomenon, which threatened the short-selling position of large hedge funds by bringing together individual investors focused on the Reddit online community, is fading.

Gamestop’s shares fell more than 30% the day before and then fell about 60% the same day.

The share price of AMC, a movie theater chain, also plunged more than 41%, and other stocks targeted by individual investors also fell at the same time.

Silver prices, which rose the day before due to purchases by individual investors, fell more than 10% on this day.

Although it may be affected by trade restrictions from Robin Hood, an online brokerage firm, experts assessed that some individual investors did not show the same concentration as before, such as taking profit and exiting.

Consequently, concerns were also eased that the loss of short selling by hedge funds could act as a factor of uncertainty throughout the market.

Expectations for the US stimulus package are also highlighted.

President Joe Biden and some Republican senators met the day before to discuss stimulus measures.

President Biden is reportedly in a position that the $ 600 billion stimulus package proposed by Republican lawmakers is too small and sticks to the existing $ 1.9 trillion stimulus plan.

The Washington Post reported that President Biden has urged Democrats to apply massive stimulus measures.

The Democratic Party is in a position to proceed with the procedure to introduce stimulus measures without the consent of the Republican Party through budget resolutions and the like.

There is also room for negotiation between the two parties. Republican Sen. Susan Collins, who spoke with President Biden, said the dialogue was productive and agreed to continue negotiations.

The performance of large companies also draws attention.

According to the Wall Street Journal, of the 189 S & P500 companies that reported earnings through the day before, about 81% posted net earnings that beat market expectations.

Since corporate performance is generally good, expectations are raised that it will be able to support the stock market.

Net earnings and sales from parent companies of Google, Alphabet and Amazon, which were announced after the market close, also exceeded market expectations.

By industry on this day, all industries went up. Tech stocks were up 1.28% and financial stocks were up 2.46%.

US economic indicators released that day were slow.

According to the New York Supply Management Association (ISM), the New York City Trade Conditions Index in January fell 10.1 points to 51.2 from 61.3 last month.

New York stock market experts say concerns over some stocks overheating are being resolved.

“Like other technically unleashed short squeezes, Reddit’s rocket is running out of fuel and crashing to the ground,” said Max Cokeman, head of asset allocation at Pacific Life Fund Advisor. “It is confirmed that gravity is still working and fundamental is important” As a result, other market participants are feeling comfortable again, and this appears to have driven the recovery rally this week. “

On the Chicago Options Exchange (CBOE), the volatility index (VIX) was 25.56, 15.48% less than the previous trading day.

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