Wall Street’s main indexes have hit record highs recently on prospects of the US$1.9 trillion relief bill that aims to jump start the US economy, while a largely better-than-expected earnings season also has bolstered sentiment. — AFP picNEW YORK, Feb 12 — The Nasdaq and S&P 500 eked out modest gains yesterday with investors betting on more fiscal stimulus, but US President Joe Biden said China was poised to “eat our lunch,” a warning that tempered enthusiasm for a market near record highs.
The warning about China and Democrat plans to include raising the minimum wage to US$15 in a US$1.9 trillion stimulus package showed headwinds for investors could be on the rise, said Ed Moya, senior market analyst at OANDA in New York. The Democrats also are not in agreement on where they stand on the minimum wage, he said. “This is dragging out stimulus talks.”
The number of Americans filing new applications for unemployment benefits were 793,000 last week, compared to 812,000 in the prior week, but they are well below the record 6.867 million reported last March when the pandemic hit the United States. “The market is certainly fairly valued. I don’t see the overall market as horribly overvalued,” said David Trainer, chief executive of New Constructs, a research firm in Nashville, Tennessee “There are pockets of stocks, we call them micro bubbles, that are extremely overvalued.”