(Reuters) – Global stocks scaled five-week highs Monday on hopes that more government stimulus would come and that the world economy was on the mend, while the Chinese yuan retreated from a 17-month high after a policy move over the weekend. Investor optimism that Washington will work through talks that have repeatedly stalled to deliver another round of fiscal stimulus drove major U.S. stock indices to highs last seen in early September. Hopes that the top Wall Street banks will announce a decent set of third-quarter earnings this week that show business was not as weak as feared also helped, while excitement over an expected debut of Apple Inc’s latest iPhone on Tuesday buoyed technology stocks. Slugged by stronger investor demand for risk, the U.S. dollar was pinned near a three-week low and gold, another safe-haven asset, stayed below a three-week high. The U.S. bond market is closed on Monday for Columbus Day. The cheer over the economic outlook and government stimulus did not boost oil prices, which dropped as investors focused on a boost in supply. The S&P 500 jumped 57 points, or 1.64%, to 3,534.22, within spitting distance of its record high of 3,580.84 struck on Sept. 2. The Dow Jones Industrial Average climbed 250 points, or 0.88%, to 28,837.52.

Shares in Apple surged 6.4% while those in Amazon rallied 4.8% ahead of its Prime Day shopping event on Oct. 13 and 14. That helped the Nasdaq Composite to stage its biggest one-day rally in a month, jumping 296 points, or 2.56%, to 11,876.26.

“The market leaders are once again the tech names, supported by the fact that the economy continues to expand,” said Phil Blancato, chief executive of Ladenburg Thalmann Asset Management in New York. MSCI’s gauge of stocks across the globe climbed 1.43% to 592.96, a

Johnson & Johnson  (JNJ) – Get Report continues to trade well, bubbling just below its prior all-time high. 

That has investors wondering if the healthcare juggernaut can notch new records after reporting earnings on Tuesday before the stock market opens. In fact, the charts are looking pretty familiar.

Shares of J&J traded down into the 200-day moving average ahead of earnings in July. Then the stock began to climb higher in anticipation of the results. While the upside reaction wasn’t overwhelmingly bullish, it was still positive.

It’s what allowed shares of Johnson & Johnson to continue higher, ultimately making new highs in early September.

Will the stock repeat its actions?

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Trading Johnson & Johnson

Daily chart of Johnson & Johnson stock.

Daily chart of Johnson & Johnson stock.

Johnson & Johnson is working on its fourth straight daily rally, while Monday’s strength should be no surprise given the broader market’s surge.

The stock put in a higher low in October vs. its September low, while reclaiming the 20-day and 50-day moving averages with its recent rally. That low in September came on a test of the 200-day moving average, which has been support so far this summer.

When measuring the September range, J&J shares were able to hit the 78.6% retracement on Monday, near $152.70.

Now bulls want to see a bullish rotation, not just over the 78.6% retracement, but over key resistance near $155. A move over this zone is vital for a breakout to occur.

If Johnson & Johnson can clear this mark and close above it, it opens the door to the $161 to $163 area. Near $161 it

Gold bullion bars after being polished at the ABC Refinery in Sydney on August 5, 2020.


DAVID GRAY/AFP/Getty Images

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Gold was up by close to 40% for the year when it hit a record high in August, but it has since nearly halved that gain, and some analysts say a move to fresh all-time highs in the final quarter may be out of reach for the precious metal.

“Gold has enjoyed a meteoric rise this year, hitting a record in early August on the back of a weak dollar and continued [Federal Reserve] support,” says Matt Orton, vice president at Carillon Tower Advisers. The Fed actions drove real rates lower, “making cash and Treasuries much less attractive, and gold a better alternative.”

Futures prices for the precious metal settled at a record $2,069.40 an ounce on Aug. 6. On Oct. 7, it settled at $1,890.80, up 24% year to date.

“Negative U.S. real rates have stabilized and started to move higher in August,” with gold moving lower as a result, Orton says. The impact of real rates and the dollar are key drivers of gold prices, not equity investor sentiment, and “with economic data continuing to show signs of a recovery, I would expect this rise in real rates to continue, as well as a general strengthening of the dollar—an additional headwind for gold.” Prices for the metal aren’t likely to reach new record highs in the near future, he says.

The Fed pledged in September to hold its benchmark interest rate between zero and 0.25% until labor-market conditions reached a certain level and inflation was on track to moderately exceed its 2% target rate “for some time.” The fed-funds rate is below zero in real terms, which takes inflation into account.

Real rates, however, stopped plunging after

(Bloomberg) — U.S. stocks retreated from almost five-week highs after House Speaker Nancy Pelosi dampened expectations for more fiscal stimulus. Treasury yields edged lower and the dollar weakened.

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The S&P 500 remained higher for a second day after President Donald Trump touted progress in talks even though there were few signs the two sides are any closer on a deal. Pelosi said there won’t be a standalone bill on airlines without a guarantee the other stimulus items are going to be addressed.

“The market is very dependent on stimulus talks,” said David Wagner, portfolio manager and analyst at Aptus Capital Advisors. “I think there is more dependence on that than the actual outcome and policy changes from a change in the administration.”

Eaton Vance Corp. leaped after the investment firm agreed to be taken over by Morgan Stanley. IBM surged after saying it will spin off its infrastructure unit. Regeneron Pharmaceuticals Inc. rose after Trump said its antibody cocktail was the “key” to his quick recovery. The president said he would authorize its emergency use.



chart: Gauge of semiconductor stocks rises to 20-year relative high versus the S&P 500


© Bloomberg
Gauge of semiconductor stocks rises to 20-year relative high versus the S&P 500

Bulls are now back in control of a market that’s increasingly betting that a Joe Biden presidential victory and gains by Democrats in Congress will be good for equities. The scenario seems to be quelling volatility even as risks from a split in government to a resurgence of coronavirus cases threaten the economic rebound.

“The market is now almost treating Trump’s actions as a sideshow, and is much more firmly pricing Biden in the White House,” Mizuho strategists including Peter Chatwell wrote in a note.

Still, they warned investors against “getting bulled-up on Biden” and the possibility of Democrats winning in the November election, including the Senate. Trump

By Swati Pandey

SYDNEY (Reuters) – A gauge of Asian shares climbed to a one-month high on Thursday, as renewed hopes for more U.S. stimulus helped restore investor confidence with markets now pricing in a Democratic victory during elections in November.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.3% for its fourth straight session of gains to a level not seen since early September.

Australia’s benchmark index jumped 1.1% to a one-month high helped by a larger-than-expected fiscal stimulus announced in federal budget on Tuesday night.

New Zealand shares rallied on expectations of further monetary policy easing after the country’s central bank said it was “actively considering” negative interest rates and a funding-for-lending programme.

Japan’s Nikkei added 0.5%.

Globally, risk assets have rallied since mid-March on a flood of central bank and government support for economies reeling from coronavirus-induced lockdowns world over. Expectations of more aggressive easing have further boosted sentiment.

“It’s another good day for risk and equities have powered up,” said Pepperstone strategist Chris Weston in Melbourne.

“Some talk of fiscal has been in play again, but this has become tiresome and the markets don’t need a reason to rally, they just don’t need to hear negative news. So, in the absence of any, we see equities flying and U.S. Treasuries offered.”

Weston expects more monetary policy stimulus from the U.S. Federal Reserve before Christmas if the fiscal package comes in too small or too late.

Aiding risk sentiment, U.S. President Donald Trump sent out a flurry of tweets on Wednesday urging Congress to pass piece-meal aid packages for targeted industries, small business and consumers, backpedaling from his earlier stance to unilaterally end negotiations.

Further, new polls show Democratic candidate Joe Biden in a firm lead against Trump ahead of the November elections. Investors see such