S&P 500 pulls back from session highs above 4,800, still on track for massive monthly / yearly gains

• The S&P 500 remains sideways following Monday’s impressive 1.4% rise and has fallen from the previous session’s highs above 4,800.
• Omicron’s receding concerns, signs of a bullish economy, and positive seasonality are cited as bullish factors helping stock market sentiment.

The S&P 500 it trades sideways on Tuesday after Monday’s impressive 1.4% rise, and the index is back from the previous session’s highs (and record highs) above 4,800. That means the index is now almost 6.0% above last Monday’s lows and, with three and a half sessions remaining for the month, it is on track to post a monthly gain of more than 5.0%. If the index closed the year at current levels, that would translate into gains of around 27%.

Traders have cited a cocktail of positives behind the rally seen in stocks this week. First of all, concerns about the impact of the Omicron Covid-19 variant have subsided substantially since last week, as it becomes clear that the new variant is much milder than any previous variant and after new pills were approved in the USA that will substantially reduce mortality from Covid. Second, analysts remain bullish on the prospect of continued earnings growth in 2022 amid signs of underlying strength in the US economy On Monday, traders received a bullish report from Mastercard that had been published on Sunday and showed a very strong Christmas shopping season in the US (sales increased 8.5% year-on-year between November 1 and December 24), easing fears that the Omicron variant would hurt the market. increase.

This has helped ease concerns following news of store closures in New York and elsewhere as retailers seek to avoid exposing staff to the Omicron variant. Apple said it had closed all 12 of its New York stores and that customers could only pick up orders. That hasn’t fazed Apple investors, as AAPL shares rose more than 2.0% on the week and surpassed $ 180 again, giving the company a market capitalization of $ 2.96 trillion. When the company inevitably surpasses $ 3 trillion, this is likely to generate a lot of headlines. Returning to the reasons the overall stock market sentiment is bullish, traders are also citing positive seasonality. According to Reuters, citing data from CFRA Research dating back to 1969, the S&P 500 has risen on average by 1.3% over the course of the last five trading days and then the first two trading days of each calendar year.

Technical levels