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Market Opens Flat Amid Uncertainty

Investors aren’t quite sure which way the wind is blowing.

During the first week of 2021, stock index values rose slightly, ballooned by decisive factors like the Georgia runoff elections and increasing efforts to administer vaccines. However, with the social climate of the United States still heavy due to last week’s Capitol riot and ongoing hearings for the second impeachment of President Donald Trump, investors have lost some of their previous zeal, causing stocks to flatten out somewhat.

At the opening of trading this morning, The Dow dropped a small 31 points, or 0.1%. The Nasdaq Composite rose a minor 0.2%, while the S&P 500 hovered slightly above the flatline. According to the latest statistics, the US consumer price index rose 0.4%, though this is well within line of projections from Dow Jones analysts.

President-Elect Joe Biden, who is slated to be sworn in next Wednesday, is planning to divulge some of his economic strategies in a report expected to release tomorrow. Analysts are expecting further discussion on potential stimulus packages for the US economy.

“At a minimum, even a USD 500bn fiscal package consisting of additional stimulus checks, extended unemployment benefits, and funding for healthcare and vaccine disbursement will be another boost to economic growth in 2021,” said Jason Draho, UBS Global Wealth Management head of Americas asset allocation.

With COVID-19 cases still on the rise around the country in spite of efforts to distribute vaccinations, analysts are unsure as to when exactly the economy will start to definitively stabilize. However, some are confident that once vaccinations reach a certain threshold of saturation, the US economy will be poised for a monumental comeback.

“In 2021, the U.S. economy should experience strong tailwinds from additional fiscal and monetary stimulus coupled with an end to the pandemic’s impact on the economy,” said Brent Schutte, chief investment strategist for Northwestern Mutual Wealth Management. “Pent-up demand in industries impacted by COVID-19 … and a needed inventory rebuild should further spur job growth,” he added.

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