which measures retail investors’ behavior and sentiment, based on a sample of accounts that completed trades in the past month. Their interests have been shifting toward less volatile names and more stable holdings like shorter-term bonds, the firm said.

Ms. Hellmann, who started actively trading in the early days of the pandemic, said she was sticking with it, learning more and refining her approach as she goes along.

She often rises at 3 a.m. and turns on CNBC to begin plotting her strategy for the day, which involves studying stocks’ price movements, a process she compared to learning to catch a softball — watching its arc, then trying to figure out the physics of where it will land. “That is what I’m doing with price and volume,” she said.

Long a buy-and-hold investor, she began with roughly $50,000 — money that came from shares of ConocoPhillips that she inherited in 2014 after the death of her grandfather, who had been a propane salesman. Her approach has grown increasingly complex over the past two years: Last fall, she took a large position in an exchange-traded fund that bets against the price of natural gas — which has gone up as Russia’s invasion of Ukraine roiled energy markets.

“The war causing natural gas to spike up at a time when it seasonally comes down did not help me much,” she said.

Even so, she’s more than quintupled her money since early 2020, riding the strength of a rally that has the S&P 500 up nearly 80 percent since it bottomed out in March 2020, even with its recent fall.

Experiencing losses after a period of gains can be instructive, said Dan Egan, vice president of behavioral finance and investing at Betterment, which builds and manages diversified portfolios of low-cost funds and provides financial planning services.

“If you have a good initial experience with investing, you see this is part of it, it will be OK,” he said. “We get bumps and bruises that you need to learn what pain feels like,” he said.

Eric Lipchus, 40, has felt plenty of pain in his nearly two decades of full-time day trading — he owned options on Lehman Brothers, the investment bank that imploded during the financial crisis of 2008-9. Before that, he had watched his older brother and father dabble in the markets during the dot-com boom and bust.

“I have been on a roller coaster,” he said. “I am making OK money this year but it’s been up and it’s been down. It seems like it could be a tough year — not as much upside as in previous years.”

Challenging conditions like investors are now facing can get stressful in a hurry, Mr. Lipchus said. Right now, he’s keeping half his portfolio in cash — and is taking a fishing trip to the Thousand Islands in a couple of weeks to clear his head.

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The Stock and Bond Markets Don’t Yet Know How to Cope With the Fed

On Wednesday, the S&P 500 stock index jumped 3 percent, as though all was right with the world. On Thursday, stocks collapsed, with the tech-heavy Nasdaq index plunging 5 percent as though the end of times was in sight.

Things on Friday were only slightly better. The S&P fell again, but only by 0.6 percent, and the Nasdaq lost a mere 1.4 percent. It was the fifth consecutive weekly decline in the S&P 500, its longest streak of losses since June 2011.

If you are looking for patterns in the market’s wild swings, the answer is simple: The financial markets are coming to grips with a stunning policy change by the Federal Reserve.

Over the last two decades, financial markets may have become so accustomed to encouragement from the Fed that they just don’t know how to react, now that the central bank is doing its best to slow down the economy.

news conference on Wednesday that the central bank was really and truly committed to driving down inflation. A transcript of Mr. Powell’s words is available on the Fed site. So is the text of the Fed’s latest policy statement. Check for yourself.

The Fed is willing to increase unemployment in the United States if that is what’s required to get the job done. And while they would much prefer that the United States doesn’t fall into a recession, Fed policymakers are willing to take the heat if the economy falters.

This may be hard to accept, and for a good reason.

millions of casualties worldwide, and it’s not over. From the narrow viewpoint of economics, the pandemic threw supply and demand for a vast variety of goods and services out of whack, and that has baffled policymakers. How much of the current bout of inflation has been caused by Covid, and what can the Fed possibly do about it?

Then there are the continuing lockdowns in China, which have reduced the supply of Chinese exports and dampened Chinese demand for imports, both of which are altering global economic patterns. On top of all that is the oil price shock caused by Russia’s war in Ukraine and by the sanctions against Russia.

Until late last year, the Fed said the inflation problem was “transitory.” Its response to an array of global challenges was to flood the U.S. economy and the world with money. It helped to reduce the impact of the 2020 recession in the United States — and it contributed to great wealth-creating rallies in the stock and bond markets.

But now, the Fed has recognized that inflation has gotten out of control and must be significantly slowed.

This is how Mr. Powell put it on Wednesday. “Inflation is much too high and we understand the hardship it is causing, and we’re moving expeditiously to bring it back down,” he said. “We have both the tools we need and the resolve it will take to restore price stability on behalf of American families and businesses.”

But its tools for reducing the rate of inflation without causing undue harm to the economy are actually quite crude and limited, he later acknowledged, in response to a reporter’s question. “We have essentially interest rates, the balance sheet and forward guidance, and they’re famously blunt tools,” he said. “They’re not capable of surgical precision.”

As if that were not scary enough, for an operation as delicate as the Fed is attempting, he added: “No one thinks this will be easy. No one thinks it’s straightforward, but there is certainly a plausible path to this, and I do think there, we’ve got a good chance to do that. And, you know, our job is not to rate the chances, it is to try to achieve it. So that’s what we’re doing.”

Well, fine. The Fed needs to make the attempt, but given the precariousness of the situation, the high volatility in financial markets is exactly what I’d expect to see.

The Federal Reserve is committed to continuing to raise the short-term interest rate it controls, the Fed funds rate, to somewhere well above 2.25 percent. Only a few months ago, that rate stood close to zero, and on Wednesday, the Fed raised it to the 0.75 to 1 percent range. The Fed also said it would begin reducing its $9 trillion balance sheet in June by about $1 trillion over the next year, and it continues to issue cautionary “forward guidance” — warnings of the kind that Mr. Powell made on Wednesday.

Watch out, he was essentially saying. Financial conditions are going to get much tougher — as tough as needed to stop inflation from becoming entrenched and deeply destructive. The Fed will be using blunt instruments on the American economy. There will be damage, inevitably. People will lose their jobs when the economy slows. There will be pain, even if it isn’t intended.

In the financial markets, short-term traders are unable to make sense of all this. The day-to-day shifts in the markets are about as informative as the meandering of a squirrel. But for those with long horizons, the outlook is straightforward enough.

A period of wrenching volatility is inescapable. This happens periodically in financial markets, yet those very markets tend to produce wealth for people who are able to ride out this turbulence.

It is important, as always, to make sure you have enough money put aside for an emergency. Then, assess your ability to withstand the impact of nasty headlines and unpleasant financial statements documenting market losses.

Cheap, broadly diversified index funds that track the overall market are being hit hard right now, but I’m still putting money into them. Over the long run, that approach has led to prosperity.

Count on more market craziness until the Fed’s struggle to beat inflation has been resolved. But if history is a guide, the odds are that you will do well if you can get through it.

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Inflation Rises to 7.9 Percent for February 2022

Prices climbed at the fastest pace in decades in the month leading up to the war in Ukraine, underlining the high stakes facing the United States — along with many developed economies — as the conflict promises to drive costs higher.

The Consumer Price Index rose by 7.9 percent through February, the fastest pace of annual inflation in 40 years. Rising food and rent costs contributed to the big increase, the Bureau of Labor Statistics said, as did a nascent surge in gas prices that will become more pronounced in the March inflation report.

The February report caught only the start of the surge in gas prices that came in response to Russia’s invasion of Ukraine late last month. Economists expect inflation to pick up even more in March because prices at the pump have since jumped to record-breaking highs. The average price for a gallon of gas was $4.32 on Thursday, according to AAA.

Rapidly climbing costs are hitting consumers in the pocketbook, causing confidence to fall and stretching household budgets. Rising wages and savings amassed during the pandemic have helped many families continue spending despite rising prices, but the burden is falling most intensely on lower-income households, which devote a big chunk of their budgets to daily necessities that are now swiftly becoming more expensive.

signaled it will raise interest rates by a quarter percentage point at its meeting next week, probably the first in a series of moves meant to increase the cost of borrowing and spending money and slow down the economy. By reducing consumption and slowing the labor market, the Fed is able to take some pressure off inflation over time.

Broadening price pressures and high gas costs could become a serious issue for central bank policymakers if they help convince consumers that the run-up in prices will last. If people begin expecting inflation, they may change their behavior in ways that make it more permanent: accepting price increases more readily, and asking for bigger raises to keep up.

“It was another bad report,” said Laura Rosner-Warburton, senior economist at MacroPolicy Perspectives. “Inflation was already way too high before the invasion of Ukraine.”

keep shipping routes tangled and parts scarce. Ukraine is an important producer of neon, which could keep computer chips in short supply, perpetuating the shortages that have plagued automakers. Higher energy costs could ricochet through other industries.

Even without further supply chain troubles, there are signs that inflation is widening beyond a few pandemic-affected sectors, an indication that they could last as the latest virus surge fades from view. Rent of primary residences, for instance, climbed by 0.6 percent from the prior month — the fastest monthly pace of growth since 1999.

Price gains have been rapid around much of the world, causing many central banks to scale back how much help they are providing to their economies. The European Central Bank on Thursday decided to speed up its exit from its bond-buying program as it tries to counter rising inflation. Europe’s push to end its energy dependence on Russia promises to raise costs at a time when inflation is already nearly triple the central bank’s target.

a separate inflation index, but one that is also up considerably.

loss of purchasing power over time, meaning your dollar will not go as far tomorrow as it did today. It is typically expressed as the annual change in prices for everyday goods and services such as food, furniture, apparel, transportation and toys.

For someone who was a longtime Manhattanite, that’s a real loss, Mr. Gutbrod, 61, said. He used to enjoy three restaurant brunches or dinners each week. Now it’s more like one every two weeks.

“I used to go on relaxing drives,” he said, but now joy rides are unaffordable. “I’m on a shoestring budget, and I work pretty hard. For anyone who doesn’t make a lot of money, you have to be intelligent and start cutting corners.”

As it disturbs everyday lives, inflation is likely to dog Democrats and the administration as they fight to retain control of Congress in November. Despite plentiful jobs and quickly rising wages, consumer confidence has fallen to itslowest level since the summer of 2011, when the economy was clambering back from the global financial crisis and Congress was bickering over lifting the nation’s debt ceiling.

That probably at least partly reflects the reality that pay is not quite keeping up with inflation for the typical worker, and that consumers are paying more at the pump, which tends to be a very salient cost for Americans.

In February, the cost of food rose, which is also difficult for consumers on tight budgets. Over the past year, grocery prices have increased by 8.6 percent, the largest yearly jump since the period ending in April 1981. Fresh fruit and dairy products became notably more expensive last month.

The White House has emphasized that it is trying to offset rising costs to the degree that it can.

“We’ve taken steps to address bottlenecks in the supply chain, to reduce those bottlenecks,” Jen Psaki, the White House press secretary, said this week.

But those changes have mostly helped around the edges, and as prices have shown little sign of moderating on their own, Fed officials have coalesced around the view that they will need to use their policies to cool off demand and keep today’s rapid inflation from becoming entrenched. That may limit the central bank’s room to react to any slowdown in growth prompted by uncertainty and high gas prices.

“They need to stay on track,” said Ms. Rosner-Warburton. “They don’t have as much leeway to respond to these risks, given how elevated inflation is.”

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Rising Gas Prices Have Drivers Asking, ‘Is This for Real?’

After months of working from home, Caroline McNaney, 29, was excited about going back to work in an office, even if her new job in Trenton, N.J., meant commuting an hour each way.

But when she spent $68 filling the tank of her blue Nissan Maxima this week, she felt a surge of regret about switching jobs.

“Is this for real?” Ms. McNaney recalled thinking. “I took a job further from home to make more money, and now I feel like I didn’t do anything for myself because gas is so high.”

The recent rise in gas prices — which the war in Ukraine has pushed even higher — has contributed to her sense of disappointment with President Biden. “I feel like he wants us to go out and spend money into the economy, but at the same time everything is being inflated,” she said.

higher heating bills. Natural gas reserves are running low, and European leaders have accused Russia’s president, Vladimir V. Putin, of reducing supplies to gain a political edge.

While oil prices worldwide have shot up since the Russian invasion of Ukraine, President Biden and Democrats, who hold control of Congress, have faced consumers’ ire.

Cat Abad, 37, who lives in the San Francisco area, where prices have hit nearly $6 for the highest-grade gas, said she saw stickers on the pumps at one local station saying that Mr. Biden was responsible for the rise. She took the stickers off, she said, believing that he was not at fault.

Still, she said, “It’s a good time to have a Prius,” as she filled up for her commute down the peninsula to Foster City.

Inflation is already proving a perilous issue for Mr. Biden and fellow Democrats as the midterm elections approach, with many voters blaming them for failing to control the rising cost of living. The higher gas prices add further political complexity for Mr. Biden, who has vowed to curb the nation’s dependence on fossil fuels.

In light of the war in Ukraine, the energy industry is pushing the Biden administration to support more domestic oil production by opening up drilling in federal lands and restarting pipeline projects.

“This moment is a reminder that oil and natural gas are strategic assets and we need to continue to make investments in them,” said Frank Macchiarola, a senior vice president at the American Petroleum Institute, a trade group.

There is a chance that the strain on consumers may be temporary as global oil supply and demand are rebalanced. And, in the near term, lower consumer spending may have some benefits. Reduced spending could help constrain inflation, but at the expense of slower economic growth.

Even before Russia invaded Ukraine, rapidly rising energy prices were contributing to the fastest inflation in 40 years. Energy prices — including not just gasoline but home heating and electricity as well — accounted for more than a sixth of the total increase in the Consumer Price Index over the 12 months ending in January.

The recent jump in energy prices will only make the problem worse. Forecasters surveyed by FactSet expect the February inflation report, which the Labor Department will release on Thursday, to show that consumer prices rose 0.7 percent last month, and are up 7.9 percent over the past year. The continued run-up in gasoline prices over the past week suggests overall inflation in March will top 8 percent for the first time since 1982.

Some drivers said the higher gas prices were a necessary result of taking a hard line on Mr. Putin.

Alan Zweig, 62, a window contractor in San Francisco, said: “I don’t care if it goes to $10 a gallon. It’s costing me dearly, but not what it’s costing those poor people in Ukraine.”

Destiny Harrell, 26, drives her silver Kia Niro hybrid about 15 minutes each day from her home in Santa Barbara to her job at a public library. She is now considering asking her boss if she can spend some days working from home.

She said the rise in prices has contributed to her anger at Mr. Putin and his decision to invade Ukraine.

“It’s super frustrating that a war that shouldn’t even really affect us has global reach.”

Ben Casselman, Coral Murphy Marcos and Clifford Krauss contributed reporting.

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Welcome to the Charles Dickens Luxury Apartments

When the building was threatened with destruction, in 2007, Professor Black and a charity devoted to Georgian-era architecture tried to get it preserved. They initially failed, but the wrecking ball didn’t swing immediately, in part because the 2007-8 financial crisis left many developers in no mood to spend. It didn’t help that the land behind the Annexe was known to be filled with bodies, although how many was not yet clear.

By then, the Annexe had closed, and the University College London Hospitals National Health Service Foundation Trust — the official name of the organization that owned the building — started renting a hodgepodge of rooms in it to about 40 Londoners looking for cheap, communal living. This is a common strategy among British landlords — populate vacant buildings to prevent them from being vandalized or turned into a squatters’ paradise. Renters in such buildings are known as “guardians,” a slightly misleading term.

“Nobody was walking around with a rifle,” said Dominic Connelly, who lived in the Annexe until 2017, when everyone was finally asked to leave. He paid about $600 a month for a large former patient’s room that included a working X-ray light box.

Tenants were a mix of young people — yoga instructors, actors, a club bouncer — dwelling amid an assortment of medical equipment, security systems, a reception desk and hospital signs, including one for the child psychiatry department. The setting also seems to have inspired “Crashing,” a 2016 television mini-series about young people who flirt and couple in a disused hospital, written by and starring Phoebe Waller-Bridge, the auteur of “Fleabag.”

Except that at the Annexe, people occasionally showed up to dig exploratory trenches.

“You’d see them from the windows, or you’d hear them digging,” Mr. Connelly said. “It was clear they were looking for bodies. Pretty grim stuff when you think about it, so I tried not to think about it.”

All the guardians in the Annexe knew they could be evicted any day, potentially signaling the workhouse’s imminent demise. The prospect was especially galling to a resident who, for unknown reasons, wanted anonymity and has never been identified. She contacted a scholar who had written an essay for The British Medical Journal about one of the medical heroes of the Victorian age, Joseph Rogers, a physician who served as the chief medical officer at the Strand Union Workhouse and crusaded for better conditions.

The scholar was Ruth Richardson.

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General Electric Plans to Break Itself Into Three Companies

It was the quintessential American company, a corporate behemoth whose ambition matched the country’s.

Formed in 1892, General Electric reached into nearly every home over the next century. It sold light bulbs, televisions and washing machines. Its jet engines opened up long-distance travel, its generators lit houses, and its medical equipment helped diagnose patients.

Now G.E. is making a final break with its storied past, splitting itself into three businesses, a victim of the lingering effects of the 2008 financial crisis and a fast-growing economy less hospitable to global conglomerates.

On Tuesday, the company said it would spin off its health care division in early 2023 and its energy businesses a year later. That would leave its aviation unit as its remaining business.

Mr. Welch also built up a huge finance arm at G.E. The assumption was that G.E.’s managers were the best in the world, and there was easy money to be made on Wall Street.

The buildup backfired when the financial crisis hit in 2008, putting G.E. in a credit crunch. Its chief executive at the time, Jeffrey R. Immelt, moved to drastically pare back the big finance unit, GE Capital.

Other businesses hit hard times because of the financial crisis as well, and some Wall Street firms collapsed. But few outside of Wall Street are still paying a price like G.E. As the company scrambled to shed many of its troubled financial assets, its overextended power-generation business became a drag on the operation.

dropped from the blue-chip index. By the fall of that year, Mr. Flannery had been forced out, replaced by Mr. Culp, a former chief executive of Danaher, a more compact conglomerate that makes scientific, medical and automotive equipment.

Under Mr. Culp, the company has paid hundreds of millions of dollars to settle with the Securities and Exchange Commission over claims that it misled investors before his arrival. He has also accelerated cost-cutting at the company. G.E., which had more than 300,000 employees worldwide in 2014, now has 161,000 workers.

Mr. Culp on Tuesday described the breakup of the company as being in step with the times, as other industry conglomerates have streamlined. In the last few years, G.E.’s big German rival Siemens has spun off its health care and energy businesses. And Honeywell International, another wide-ranging industrial company, has sold off some operations.

Trian, the activist shareholder firm led by Nelson Peltz, have pressured the company to spin out or sell various businesses, and they cheered the move on Tuesday.

“Trian enthusiastically supports this important step in the transformation of G.E.,” a spokeswoman for Trian said.

Shares of G.E. climbed about 3 percent in trading on Tuesday.

The three new stand-alone companies will be sizable. The jet engine business had revenue of $22 billion last year. There are 36,000 G.E. engines on commercial airliners worldwide and 26,000 engines on military aircraft.

Its health care business had $17 billion in revenue last year, with four million of its imaging and other machines in use at hospitals and clinics around the world.

The new energy and power company will include wind turbines and gas-fueled power generators that produce about one-third of the world’s electricity.

Each of those businesses faces challenges — the aviation unit is emerging from the pandemic falloff in air travel, and the power business must adapt to the shift to alternative energy sources.

But each one, Mr. Culp insisted, would be a strong competitor in its respective market, “a simpler, stronger and more focused company,” easier to manage and easier for investors to understand.

It is a message very different from the G.E. of old.

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Americans Are Flush With Cash and Jobs. They Also Think the Economy Is Awful.

Americans are, by many measures, in a better financial position than they have been in many years. They also believe the economy is in terrible shape.

This is the great contradiction that underlies President Biden’s poor approval ratings, recent Republican victories in state elections and the touch-and-go negotiations over the Biden legislative agenda. It presents a fundamental challenge for economic policy, which has succeeded at lifting the wealth, incomes and job prospects of millions of people — but has not made Americans, in their own self-perception, any better off.

Workers have seized the upper hand in the labor market, attaining the largest raises in decades and quitting their jobs at record rates. The unemployment rate is 4.6 percent and has been falling rapidly. Cumulatively, Americans are sitting on piles of cash; they have accumulated $2.3 trillion more in savings in the last 19 months than would have been expected in the prepandemic path. The median household’s checking account balance was 50 percent higher in July of this year than in 2019, according to the JPMorgan Chase Institute.

Yet workers’ assessment of the economy is scathing.

In a Gallup poll in October, 68 percent of respondents said they thought economic conditions were getting worse. The share who thought things were getting better was lower than in April 2009, when the global financial crisis was still underway. And it is not merely a partisan response to the Biden presidency. In the University of Michigan’s consumer sentiment survey, Republicans rate current economic conditions worse than Democrats do — but both groups give ratings about as low as they did in the early 2010s, when unemployment was much higher and Americans’ finances were a wreck.

shortages and other inconveniences that do not show up in inflation data but reflect the same underlying phenomenon.

data from the Atlanta Fed. Many retirees receive pensions that are not adjusted for inflation.

And it is middle- and high-income earners whose pay gains were least likely to have kept up with inflation. Over the 12 months that ended in September, those in the top quarter of earners experienced 2.7 percent gains in hourly earnings, compared with 4.8 percent for the lowest quarter of earners. For lower earners, that follows years leading up to the pandemic in which pay gains exceeded inflation rates.

The details of what a person buys can have an outsize effect on how acutely he or she feels the pain of inflation. For someone who has had no need to buy an automobile this year, steep inflation in cars and trucks has been a nonissue.

wrote in 1997. The idea of inflation, he continued, evokes “arbitrary injustice, arbitrary redistributions and social bitterness,” and “memories of social situations in which morale and a sense of cooperation were lost.”

That may be what makes the inflation surge such a tricky policy problem: It can be about something more profound than dollars in people’s pockets and the price of a gallon of gas.

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Stocks Hit a Record as Investors See Progress Toward a Spending Deal

Wall Street likes what it’s hearing from Washington lately.

The S&P 500 inched to a new high on Thursday, continuing a rally aided by signs of progress in spending talks that could pave the way for an injection of some $3 trillion into the U.S. economy.

The index rose 0.3 percent to 4,549.78, its seventh straight day of gains and a fresh peak after more than a month of volatile trading driven by nervousness over the still-wobbly economic recovery and policy fights in Washington.

market swoon that began in September.

Share prices began to rise this month when congressional leaders struck a deal to allow the government to avoid breaching the debt ceiling, ending a standoff that threatened to make it impossible for the country to pay its bills. The rally has gained momentum as investors and analysts grow increasingly confident about a government spending package using a recipe Wall Street can live with: big enough to bolster economic growth, but with smaller corporate tax increases than President Biden’s original $3.5 trillion spending blueprint.

continuing supply chain snarls, higher prices for businesses and consumers and the Federal Reserve’s signals that it would begin dialing back its stimulus efforts all helped sour investor confidence. The S&P 500’s 4.8 percent drop in September was its worst month since the start of the pandemic.

It has made up for it in October, rising 5.6 percent this month. But it’s not just updates out of Washington that have renewed investors’ optimism.

The country has seen a sharp drop in coronavirus infections in recent weeks, raising, once again, the prospect that economic activity can begin to normalize. And the recent round of corporate earnings results that began in earnest this month has started better than many analysts expected. Large Wall Street banks, in particular, reported blockbuster results fueled by juicy fees paid to the banks’ deal makers, thanks to a surge of merger activity.

Elsewhere, shares of energy giants have also buoyed the broad stock market. The price of crude oil recently climbed back above $80 a barrel for the first time in roughly seven years, translating into an instant boost to revenues for energy companies.

debt limit, is a cap on the total amount of money that the federal government is authorized to borrow via U.S. Treasury bills and savings bonds to fulfill its financial obligations. Because the U.S. runs budget deficits, it must borrow huge sums of money to pay its bills.

On Thursday, analysts spotlighted the news that the White House and congressional Democrats were moving toward dropping corporate tax increases they had wanted to include in the bill, as they hoped to forge a deal that could clear the Senate. A spending deal without corporate tax increases would be a potential boon to profits and share prices.

“A stay of execution on higher corporate tax rates would seem a potentially noteworthy development,” Daragh Maher, a currency analyst with HSBC Securities, wrote in a note to clients on Thursday.

An agreement among Democrats on what’s expected to be a roughly $2 trillion spending plan would also open the door to a separate $1 trillion bipartisan infrastructure plan moving through Congress. Progressives in the House are blocking the infrastructure bill until agreement is reached on the larger bill.

But the prospects for an agreement have helped to lift shares of major engineering and construction materials companies. Terex, which makes equipment used for handling construction materials like stone and asphalt, has jumped more than 5 percent this week. The asphalt maker Vulcan Materials has risen more than 4 percent. Dycom, which specializes in construction and engineering of telecommunication networking systems, was up more than 9 percent.

The renewed confidence remains fragile, with good reason. The coronavirus continues to affect business operations around the world, and the Delta variant demonstrated just how disruptive a new iteration of the virus can be.

Another lingering concern involves the higher costs companies face for everything from raw materials to shipping to labor. If they are unable to pass those higher costs on to consumers, it will cut into their profits.

“That would be big,” Mr. McKnight said. “That would be a material impact to the markets.”

But going into the final months of the year — traditionally a good time for stocks — the market also has plenty of reasons to push higher.

The recent weeks of bumpy trading may have chased shareholders with low confidence — sometimes known as “weak hands” on Wall Street — out of the market, offering potential bargains to long-term buyers.

“Interest rates are relatively stable. Earnings are booming. Covid cases, thankfully, are dropping precipitously in the U.S.,” Mr. Zemsky said. “The weak hands have left the markets and there’s plenty of jobs. So why shouldn’t we have new highs?”

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