The Nasdaq Composite and Dow Jones Industrial Average each had impressive days in the market this Monday.
Nasdaq closed at 3,994.57 following a confidence-boosting soar to 4000 during the day, and Dow closed at 16,072.54, a record high. According to Luke Swiderski at Reuters, the big performer for the Dow was Wal-Mart Stores Inc. (WMT.N), which closed with a stock price of $80.43, down from an all-time intraday high of $80.57.
The two stock indices in question may raise confidence in the U.S. for different reasons. The Nasdaq index contains over 3,000 components, including many technology companies and growing companies. Therefore, increases of its numbers can signal growth in the technology sector overall.
The peak of 4000 is not an all-time high for the index, but USA Today‘s Adam Shell and Kim Hjelmgaard point out that Nasdaq has not reached that milestone since September 2000 and that the stock is regaining from its early-2000’s crash to 1114. They go on to say that the index is up 32.2 percent this year.
Dow represents 30 large U.S.-based companies. It is arguably a better measure for how the U.S. economy is doing overall.
Swiderski notes that trading volumes are expected to remain low for most of the week as a result of the looming Black Friday, the day after Thanksgiving, when many retailers offer substantial discounts to consumers.
Dennis Dick, who Swiderski says is a proprietary trader at Bright Trading LLC, commented on the issue.
“Retailers are taking focus this week. Black Friday is coming up, so there will be obviously some positioning ahead,” Dick said.
It is only a matter of time before traders calculate the relevant sales numbers and buy or sell their stocks accordingly.
Swidersky also reported on the price of crude oil, which traded lower following U.S. talks with Iran that resulted in the Middle East country partially halting enrichment of much of its uranium reserves.
The political deal, like the stock numbers, may boost traders’ spirits, but it is unlikely to cause crude oil prices to drop further in the short term because a host of sanctions on Iran remain in place.
Low oil prices may have a positive effect on holiday shopping, given that the less consumers will have to pay at the pump the more they will have to spend during the holidays.
Image courtesy of Ian Lamont via Flickr