Last week, US stocks had an incredibly rough week as concerns over the economic conditions in the United States and around the world pulled on investors' heart strings. However, Monday seemed to be an entirely new story as US stocks started to bounce back. The Dow Jones Industrial Average, S&P 500, and NASDAQ all saw massive gains at the closing bell Monday. Today, we'll take a look at the gains realized Monday, why US stocks surged, and what we can expect throughout the rest of the week.
What We Saw In The Market Monday
Dow Jones Industrial Average – The Dow Jones Industrial Average saw impressive gains Monday. At the closing bell, the index had reached 17,976.31 after a gain of 263.65 or 1.49%.
NASDAQ – The NASDAQ also enjoyed Monday's rally with impressive gains of its own. By the closing bell, the index had climbed to 4,947.44 after a gain of 56.22 or 1.15%.
S&P 500 – Finally, the S&P 500 wasn't left out of the fray as it posted gains of its own Monday. By the end of the day, the index made it to 2,086.24 after a gain of 25.22 or 1.22%.
What Caused The Gains We Saw Monday
Last week, we saw losses as a result of turmoil in the currency market and concerns with the economic conditions in the United States and around the world. However, it seems as though the United States dollar's value has started to stabilize; giving investors peace of mind in investing once again. While economic concerns haven't vanished by any means, they weren't the forefront of stories in major media Monday as investors and media outlets started to focus on positive corporate data that has surfaced recently.
What We Can Expect Moving Forward
In the short term, the outlook seems great. Investors are putting faith back into US stocks, the United States dollar, and corporate America. As a result, we should continue to see improvements in United States stocks throughout at least the next week.
Next month will also most likely be a strong month considering the earnings reports that are coming out. Some of the strongest companies in the world including Twitter, Google, Apple, and more will be releasing their results for the first fiscal quarter of 2015; and experts are expecting the reports to be incredibly positive. So, chances are that the positive reports will give US stocks even more of a boost.
However, my outlook isn't all positive unfortunately. In June, the Federal Reserve is likely to increase interest rates in the United States. While no one expected low interest rates to last forever, most investors have been banking on the easy money the economic stimulus plan has pumped into the market. As soon as interest rates start to go up, we can expect to see a bit of a sell off in the market as investors start to ditch excessively risky strategies we've seen being used lately.
All in all, it seems like we will see smooth sailing in the market in the short term. So, binary options traders should watch for the uptrends and turn them into profits. On the other hand, in the long term, increase interest rates could cause a bit of mid-year turmoil. So, keep your eyes pealed for mid-year downtrends leading to put opportunities.