The market party is still going on! New York (Ap) — U.S. stocks closed higher Monday on hopes of recovery, with the Nasdaq index breaking through 9,900 for the first time in history, setting intraday and closing records and the first of the three major stock indexes to confirm a new bull market. The dollar suffered profit taking declines and gold rebounded from lows to close just below the 1,700 mark. This trading day, the market continues to focus on risk sentiment changes.
Crazy!!! The Nasdaq hit a record high of 1,700 gold prices
The US President hailed a breakthrough on Monday, when surprisingly strong non-farm data on Friday gave a boost to the recent global recovery trade, pointing to a record closing high and confirming a new bull market.
The Nasdaq broke through 9,900 for the first time in its history on Monday, setting intraday and closing records and becoming the first of the three major indexes to confirm a new bull market as the Dow and S&P 500 jumped on growing expectations of a quick recovery from the downturn caused by the new covid-19 pandemic.
All three major U.S. stock indexes ended higher, with the Dow Jones Industrial Average up 461.46 points, or 1.7%, at the close. The S&p 500 rose 38.46 points, or 1.2 percent; The Nasdaq rose 110.66 points, or 1.13 percent.
It’s worth noting that behind Monday’s rally was a piece of news from the Federal Reserve. In the early hours of Tuesday Beijing time, the Federal Reserve announced the expansion of its Main Street Lending Program, saying it had eased terms to allow more businesses to participate, as the market waited for the Fed to finally formally launch its Main Street Lending Program. It was late in the day, and the Fed’s statement pushed all three indexes higher.
The Fed said it would reduce the initial minimum lending level and increase the maximum amount that can be borrowed, in addition to extending loan repayments to five years. The program is part of the Federal Reserve’s efforts to provide assistance to small businesses during the covid-19 recession.
Under the new guidelines, the minimum loan amount for ordinary businesses will now be reduced to $250,000 from the previous $500,000. The maximum amount will vary by business, but could increase to $300 million from $200 million.
In addition to changing the size of the loan, the Fed extended the maturity of the loan from four years to five years, and moved the principal repayment program from one year to two, with interest payments still delayed by one year.
In a statement explaining the changes to Main Street, Fed Chairman Colin Powell said: “[We will] support small and medium-sized businesses so they can be ready to reopen and hire workers, which will help promote a broad-based economic recovery. “I am confident that the changes we are making will improve The ability of Main Street to support employment during this difficult time.”
U.S. stocks have recouped all of their losses for the year, helped by a recent rally driven by central bank stimulus and investor optimism that economic activity may be rebounding.
At this point, us stocks have gained more than 40 per cent from their mid-March lows; The Nasdaq is up 10.6 per cent since the start of the year, while the S&P 500 is little changed. The rally comes amid a novel Coronavirus epidemic that sparked a recession and riots in the U.S. following the death of black George Floyd at the hands of police.
“Big day for the stock market, smart money and the world know we’re headed in the right direction and jobs are coming back fast,” President Donald Trump tweeted on June 8. Next year will be our greatest ever!”
Market participants are now waiting for the Fed’s two-day policy meeting, which ends on Wednesday, but they have stopped predicting the possibility of negative interest rates because of a surprise increase in non-farm payrolls.
It will be the first meeting since Fed Chairman Colin Powell said in April that the economy could be weighed down by a shutdown for more than a year.
The Fed will need to weigh signs that the impact on the economy is past its worst against evidence that the epidemic itself is not yet under control. While the Fed is not expected to make a major policy decision, it will release its first economic forecast since December.
“The Fed will continue to be dovish and they will continue to hold down real interest rates, which have been the main driver of gold buying over the past few months,” said Daniel Ghali, commodity strategist at TD Securities. He added that the macro impact would continue to support gold prices.
Saxo Bank analyst Ole Hansen said gold’s rise was also technical. “Friday’s dip below $1,700 has again attracted some demand from investors who had been on the sidelines waiting for a correction.”
Beware of the geopolitical situation! North Korea has announced it will completely cut off all inter-Korean communication lines
The DEMOCRATIC People’s Republic of Korea (DPRK) will close all communication channels between the ROK and the DPRK starting at noon, KCNA reported Tuesday.
Kcna announcement published on June 9th, the DPRK authorities will be starting on June 9, 2020 12 when cut off and liaison offices have been abolished by north and South Korea to maintain communication link between north and South Korea authorities, between north and South Korea’s military sea communication link, the two koreas communications test link, the workers’ party of Korea Central Line communications link between the main building and the blue house.
Kim Yo-jong, first vice minister of the Workers’ Party of China (WPK), and Kim Yong-chol, vice chairman of the CPC Central Committee, stressed the importance of changing “work toward the ROK” to “work toward the enemy,” and issued instructions to close all communication channels between the two koreas, the report said.
Last week, North Korea threatened to “torture” Seoul. Ms Kim also demanded that South Korea immediately stop distributing leaflets on the north-south border (denouncing the Kim regime, human rights issues, North Korea’s nuclear ambitions, etc.) or the North would consider tearing up a military agreement aimed at easing border tensions during Mr Moon’s visit in 2018.
Kcna said north Korea was so disappointed by the south’s hostile moves that “there is no need to sit down and face the South Korean leader”.
The latest news from North Korea highlights further tensions between the two sides, with gold often finding safe-haven support amid rising geopolitical tensions.