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US Stocks gain as Biden unveils $2.3 trillion infrastructure plan

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Capital Market
Last Updated : Apr 01 2021 | 9:16 AM IST
The US stocks were mostly higher on the last trading session of the month, Wednesday, 31 March 2021, with Nasdaq and the S&P 500 finishing higher, helped by window dressing on the final day of the first quarter and report from payroll processor ADP showing strong private sector job growth in the month of March. Meanwhile, President Joe Biden $2.3 trillion infrastructure pitch and the possible impact on growth and inflation also supported market upward momentum.

At the close of trade, the Dow Jones Industrial Average index declined 85.41 points or 0.26% to 32,982. The S&P 500 added 14.34 points or 0.36% to 3,973. The tech-heavy Nasdaq Composite Index added 201.48 points or to 1.54% 13,247.

For the month, the Dow rose 6.6%, and gained 7.8% for the quarter. The S&P 500 rose 4.2% in March and 5.8% for the quarter. The Nasdaq Composite eked out a 0.4% monthly gain and advanced 2.8% for the quarter.

Market sentiments strengthened amid optimism about the U.S. economy after President Joe Biden has outlined a $2.3 trillion plan to reengineer the nation''s infrastructure over the next eight years in what he billed as "a once in a generation investment in America". The plan calls for spending approximately $2.3 trillion over eight years, with the proposal including investments in transportation infrastructure and accelerating the transition to clean energy. Funding for the infrastructure projects would come from a hike on corporate taxes that would aim to raise the necessary piles of money over 15 years and then reduce the deficit going forward. In doing so, Biden would undo the action by Trump and congressional Republicans to lift the corporate tax rate to 28% from the 21% rate set in a 2017 overhaul.

ECONOMIC NEWS: US Private Sector Adds the Most Jobs in 6 Months In March - US private sector employment surged up by 517,000 jobs in March after climbing by an upwardly revised 176,000 jobs in February, partly reflecting a jump in employment in the leisure and hospitality industry, payroll processor ADP reported on Wednesday. The increase in private sector employment in March reflected the strongest job growth since the spike of 821,000 jobs seen last September. The report said employment in the service-providing sector shot up by 437,000 jobs, partly reflecting an increase of 169,000 leisure and hospitality jobs. Employment in the goods-producing sector also climbed by 80,000 jobs amid job growth in both the manufacturing and construction industries.

US Pending Home Sales Tumble In February- US pending home sales index plummeted by 10.6% to 110.3 in February after tumbling by 2.4% to a revised 123.4 in January, according to a report released by the National Association of Realtors on Wednesday. A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.

US private sector employment surged up by 517,000 jobs in March after climbing by an upwardly revised 176,000 jobs in February, partly reflecting a jump in employment in the leisure and hospitality industry, payroll processor ADP reported on Wednesday. The increase in private sector employment in March reflected the strongest job growth since the spike of 821,000 jobs seen last September. The report said employment in the service-providing sector shot up by 437,000 jobs, partly reflecting an increase of 169,000 leisure and hospitality jobs. Employment in the goods-producing sector also climbed by 80,000 jobs amid job growth in both the manufacturing and construction industries.

Bond yield stability supported technology shares with Tesla (+5.1%), Apple (+1.9%), Microsoft (+1.7%) and Facebook (+2.3%) all up. Walgreens Boots Alliance shares rose 3.6% after raising its 2021 profit forecast. Shares of online pet product company Chewy jumped 5.4% on broker upgrades after it reported a fourth quarter profit. The Dow Jones index fell by 85 points or 0.3%.

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COMMODITY NEWS: Global oil prices fell on Wednesday after an OPEC+ panel meeting ended without an oil policy recommendation ahead of Thursday's OPEC+ meeting. Brent crude fell by US60 cents or 0.9% to US$63.54 a barrel. And the US Nymex price lost US$1.39 or 2.3% to US$59.16 a barrel.

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First Published: Apr 01 2021 | 8:58 AM IST

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