Dow Struggles for Direction on Political Jitters, Tech Stumbles

This post was originally published on this site – The Dow struggled for direction Tuesday as investors weighed up strength in value stocks against weakness in tech amid rising political tensions after Democrats said they would move ahead with a plan to impeach President Donald Trump.

The Dow Jones Industrial Average rose 0.23%, or 71 points. The S&P 500 was up 0.01%, while the Nasdaq Composite gained 0.20%.

Trump criticized the Democrats for seeking to impeach him, insisting that his remarks in the run-up to the attack on Capitol Hill were “appropriate.” The president also hit back at big tech, in particular social media firms, several of which have reined in his reach by restricting access to his accounts.

Twitter Inc (NYSE:TWTR) fell 3%, while Facebook Inc (NASDAQ:FB), and Alphabet (NASDAQ:GOOGL) were down about 1%.

The House of Representatives said they would move ahead with a vote to impeach Trump on Wednesday, accusing him of inciting supporters to storm the U.S. Capitol. The vote comes as Vice President Mike Pence is unlikely to give in to the Democrats demand to invoke the 25th amendment and remove Trump from office.

Value stocks stifled downside momentum in the broader market as investors bet the economy could snap back stronger under a new administration that is expected to be heavily focused on spending.

President-elect Joe Biden is expected to lay out his multi-trillion stimulus plan on Thursday. The stimulus plan is likely to include a proposal to boost stimulus checks to $2,000 from $600, provide state and local aid, and fund the ongoing vaccine roll out.

Energy added to gains from a day earlier, led by a rise in oil prices as Wall Street continued to tout further gains ahead amid expectations for further stimulus and the vaccine roll out.

Goldman Sachs (NYSE:GS) forecast Brent crude reaching $65 a barrel by the middle of 2021, ahead of their previous estimate for year-end.

“Oil demand remains very levered to reaching herd immunity, with half of global oil demand losses still coming from jet, where international travel remains down 75% despite domestic flying only down 28%,” Goldman Sachs said.

Industrials were inching up nearly 1% even as Boeing (NYSE:BA) slipped after aircraft orders fell by 17 in December, which included 105 737 Max cancelations, taking deliveries for the year to 157, down from 380 last year.

In other news, General Motors (NYSE:GM) rose 7% to a record high as the automaker unveiled its electric van called the EV600, expected to launch later this year.

Zoom Video Communications (NASDAQ:ZM) jumped 5% after it sold 1 million Zoom Phone seats, a core product in its unified communication platform, within two years after launch. The stock was lower in pre-market trade after the company said it would sell $1.5 billion in stock to raise funds. 

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