“Rally On! How This Month’s Stock Market Performance Impacts Your 2021 Investing Strategies

The stock market has started December off on a strong note and that could mean good news for investors as the year winds down. The bullish market has been driven largely by a slew of positive news and market stabilizing measures from global economic powers. With central banks around the world implementing supportive monetary policies and new vaccines being rolled out, investors are feeling more confident about the economic outlook for the rest of the year. Wall Street’s key indexes have all made new highs over the past few weeks and the tech-heavy NASDAQ was up by almost 3 percent in the first week of December. This is welcome news for investors as the final stretch of the year traditionally sees the stock market rally driven by strong performance from tech stocks. The U.S. government has also played its part in boosting investor sentiment. It rolled out several stimulus programs since the pandemic began, including the CARES Act which provided one-time payments to individuals and families. This helped boost consumer spending, which in turn has had a positive impact on financial markets. A lot of the good news is coming from abroad as well. The Eurozone’s economy is slowly improving, China’s PMI data is suggesting that the manufacturing sector is growing and Japan is even beginning to post positive trade figures. All this positive news has helped bolster confidence in the global economy, leading to more investor inflows into the stock market. So, is the strong start to December enough to carry the markets to the end of the year? Most analysts are hoping that it will be, as the market has traditionally seen a year-end rally and investors would be ready to jump on board. Of course, there are still plenty of risks out there, including the volatile virus situation and lingering uncertainty around the vaccine rollout, but the early signs are encouraging. Overall, the market’s strong start to December could be a sign of things to come. Investors will be watching closely as the year winds down and hoping for similar gains in the final stretch. If the positive trends continue, the year 2020 could yet end on a high note.