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by Martin on October 7th, 2021

Wall Street Closes in Positive Territory Due to Optimism About the National Debt Limit

US stock indexes rose on Wednesday in hopes of investors that the Republicans and Democrats in the US Congress will reach an interim agreement that will allow the country to avoid a default on public debt.

Senate Republican Minority Leader Mitch McConnell said his party would support the suspension of the government borrowing limit for two months in exchange for Democrats’ refusal to act unilaterally.

“McConnell made a number of dovish comments about the temporary increase in the public debt ceiling,” said Jay Hatfield of Infrastructure Capital Advisors. “This will be seen as positive in the short term.”

Meanwhile, Wall Street stocks were down for much of the session after a strong ADR report showed that US private sector jobs rose 568,000 in September, higher than forecast.

Markets are now awaiting official employment data, which will be released by the US Department of Labor on Friday. Strong labor statistics are perceived by the market as another argument in favor of the early withdrawal of stimulus by the Federal Reserve.

The Dow Jones closed 0.3% higher to 34,416.99 points, the S&P 500 rose 0.41% to 4,363.55 points, while the Nasdaq rose 0.47% to 14,501,911 points.

Amazon (NASDAQ: AMZN) and Microsoft (NASDAQ: MSFT) rose more than 1% on the back of declining US government bond yields.

American Airlines (NASDAQ: AAL) Group tumbled 4.3% after Goldman Sachs (NYSE: GS) downgraded its recommendation for the airline to sell.

Also, analysts at the bank downgraded their recommendations for steel company Nucor Corp (NYSE: NUE) to neutral, after which they fell 2.8%.

By Martin

Martin is a professional trader with 3 years of working experience in a Cyprus-based brokerage. After the experience, he moved to the UK where he became a financial news reporter at a local news outlet. His years of trading experience help him deliver the most quality news, while also analyzing its impacts on various markets.

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