The coronavirus is expected to be the dominant driver of markets in the week ahead, and even if there is volatility, analysts believe the market is resilient and has momentum to go higher for now.
Walmart, ViacomCBS and Deere are among companies reporting earnings in the week ahead.
Analysts expect to see more companies detailing the impact of the virus on their operations or supply chains.
Stocks rose for a third straight day on Wednesday, pushing the S&P 500 back to levels hit prior to the coronavirus scare.
The broad index closed 1.1% higher at 3,334.69, led by strong gains in the energy, financials and health care sectors. That gain drove the S&P 500 to a record closing high. It also erased its losses stemming from fears over the coronavirus and came within a whisker of hitting an all-time intraday high.
Read MoreThe S&P 500 has dropped 3% from its record high. Economically cyclical groups have been purged. Bonds are leading stock returns one month into the year.
Something was bound to come along and prompt a pullback. As it happened, the viral outbreak arrived to do the job.
Given that a perfectly routine decline following a strong multi-month rally could amount to 2% to 5%, a further drop of 2% to 3% would not compromise the broader uptrend.
Bond markets pricing in a high likelihood of another Fed rate cut around mid-year.
Stocks rose to all-time highs on Thursday, led by tech shares, as the strong rally in 2019 continued in the first trading day of the new year.
The Dow Jones Industrial Average advanced 330.36 points, or 0.9% to 28,868.80 and notched its biggest one-day gain since Dec. 6. The S&P 500 closed 0.8% higher —marking its best performance since Dec. 12 — at 3,257.85. The Nasdaq Composite gained 1.3% to end at 9,092.19 and had is best day since Oct. 11. The major averages hit their session highs in the final minutes of trading.
Read MoreBuffett isn’t the only famous stock gift-giver: In 2017, Kanye West gave Kim Kardashian West over $100,000 in stock in companies like Apple, Amazon and Disney. On her Instagram, Kardashian West revealed the gift included 920 Disney shares and around 995 shares in Adidas.
Read MoreInvestors are expecting to have a very different Christmas Eve than the last one that saw the S&P 500 dip into bear market territory. On Dec. 24, 2018, the Dow Jones Industrial Average lost about 650 points in its worst day of Christmas Eve trading ever amid turmoil in Washington. President Donald Trump teased about firing Federal Reserve Chair Jerome Powell after the central bank hiked interest rate in December, triggering a massive sell-off.
Read MoreThe stock market tends to have unusually strong performance during the final five trading days of the year and the first two tradings days of the new year.
The S&P 500 has posted a 1.3% gain on average since 1950 during those periods, according to Stock Trader’s Almanac.
A net 7% of stocks on the Nasdaq and New York Stock exchanges hit new 52-week highs last week, a bullish sign for the market.
Sentiment Trader said it was the most in six months, and the increase in highs is often a good longer-term signal for the market.
“It’s really a market firing on all cylinders. It’s such a key point here,” said one technical analyst, noting the breadth of the market has been improving.
The Dow Jones Industrial Average is only about 2% from a record high, but confidence is hard to come by when wealthy investors are asked about the future direction for the market. The percentage of the affluent investors who expect a stock market decline to be booked in the fourth quarter has doubled, according to a survey conducted by E-Trade Financial this month.
Read MoreTrade war? Yes. Global slowdown? Yes. Volatile market? Yes. But does that mean investors should cash out and run? Not this top-performing fund manager. She’s staying put.
Joanna Kwok, who co-manages the JPMorgan Asia Growth Fund, says volatility will linger in Asia markets due to trade war uncertainty and corporate earnings concerns. Even with the unpredictability of U.S. President Donald Trump and other political risks, investors should hang on as valuations suggest “decent” returns in the next 12 months, she said.
Read MoreDalio now heads Bridgewater Associates, the world’s largest hedge fund with roughly $160 billion in assets. But when he was only 12 years old in the early 1960s, Dalio just wanted somewhere to invest the money he’d earned caddying on a golf course and everyone he knew was talking up the stock market.
Read More“Often there are opportunities that everybody can see, but you’re restricted by mandate or asset class,” says Margaret Patel, manager of Wells Fargo Asset Management’s Diversified Capital Builder fund. “We have a much more flexible approach.”
This approach has paid off. Patel’s fund is up 16.5% this year and is outperforming 97% of its counterparts.The five-star-rated fund has also done well long term.
Uber seeks to raise about $9 billion in cash in its initial public offering next month when it debuts on the New York Stock Exchange under the symbol “UBER.”
Uber gave a pricing range between $44 and $50 per share, valuing the company between $80.53 billion and $91.51 billion on a fully diluted basis.
The stock is posed to bring in billions for its top shareholders.
