Early in October we talked about how the stock market just needed a bit of good news to climb higher, and this past week we saw a lot of good news in the eyes of the market:
- A good employment report on Friday (released the first Friday of every month).
- Positive pandemic news with Pfizer working on a new drug to treat Covid, vaccinations being approved for children, and new vaccine mandates for employees of private companies.
- The Federal Reserve meeting on Wednesday had positive remarks on the economy, inflation, and interest rates.
- Election results Tuesday night showed Republican gains in key races. This may be an indicator of a resurgence in Republican strength for the mid-term elections, which puts pressure on the progress of the Democrat’s agenda. (The stock market tends to favor inaction in Washington.)
- And, a continuation of strong corporate earnings announced through earnings season.
It’s quite possible the market advance following all this positive news may temporarily slow down or stall out over the next couple of weeks. This type of price movement is called consolidation and it’s a natural part of how the stock market advances.
Photograph by Good Good Good
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