Tesla Becomes 'Cheonibae Seulla'... Strong Start for November Trading on NY Stock Exchange

[Asia Economy New York=Correspondent Baek Jong-min] Major indices on the New York Stock Exchange closed at record highs in the first trading session of November, reflecting expectations for a year-end rally. Concerns over the Federal Reserve's (Fed) decision to taper asset purchases have not significantly impacted the market.

[Image source=Reuters Yonhap News]

On November 1 (local time), the Dow Jones Industrial Average rose 94.28 points (0.26%) to close at 35,913.84, the S&P 500 index increased by 8.29 points (0.18%) to 4,613.67, and the Nasdaq index surged 97.53 points (0.63%) to finish at 15,595.92.

On this day, the Dow crossed 36,000 intraday for the first time ever, fueling expectations for further gains.

The New York stock market showed strength in October based on strong corporate earnings and continued its bullish trend from the first day of November, heightening hopes for a year-end rally. The possibility of a tapering announcement scheduled for this week has not deterred the market rally. The 10-year U.S. Treasury yield rose slightly to 0.156%, but the increase was not significant. Although the tapering timing is approaching, Treasury yields have actually fallen near 1.7%.

The S&P 500 fell more than 4% in September but rose 7% in October. According to Stock Traders Almanac, September is historically the month with the lowest stock market returns, averaging a 0.4% decline since 1950. October is also traditionally a weak month, but contrary to expectations, the market closed strong.

Tom Lee, partner at Fundstrat, explained, "Expectations for a global economic recovery are driving the stock market rally."

According to Refinitiv, more than half of the companies listed on the S&P 500 have reported earnings so far, with over 80% exceeding quarterly net income estimates.

Small-cap stocks also stood out on this day. The Russell 2000 index, which focuses on small-cap stocks, rose 2.6%, reaching its highest level since August and joining the market rally. This indicates that the upward momentum has spread from large-cap to small-cap stocks.

The Fed is expected to begin tapering at the FOMC regular meeting scheduled for November 2 and 3.

With U.S. inflation reaching its highest level in 30 years, there are mixed forecasts about whether the Fed will proceed from tapering to early rate hikes. Goldman Sachs anticipates the first rate hike by mid-next year, while Morgan Stanley expects it in 2023.

Peter Boockvar, Chief Investment Officer at Bleakley Advisory Group, expressed concern, saying, "The stock market is playing a game of chicken over inflation, interest rates, and central bank responses."

Among individual stocks, electric vehicle maker Tesla's soaring stock price was particularly notable. Tesla shares surged 8.49% on the day, surpassing $1,200. Following its third-quarter earnings announcement, Tesla has been climbing rapidly, breaking through $1,000, $1,100, and $1,200 levels consecutively, setting new highs.

On this day, U.S. stock expert Jim Cramer described Tesla's rise as astonishing, saying, "I've never seen a stock that keeps going up endlessly like Tesla." Tesla's stock rose 50% in October alone and approximately 200% over the past 12 months.

Although not as dramatic as Tesla, automaker Ford also rose 5% after announcing strong earnings.

Novavax shares jumped more than 15% on news that Canadian health authorities completed the sequential submission of data for COVID-19 vaccine approval.

This content was produced with the assistance of AI translation services.