US STOCKS are poised for more upward momentum even as uncertainty over oil prices and Greek debt negotiations keeps the market on tenterhooks, analysts say.
Strong fourth-quarter US company earnings and signs of an overall improving economy, alongside what appears to be the start of a bottoming in crude oil prices, have given equities support.
After starting 2015 with its sharpest monthly drop in a year and a spike in volatility, the benchmark S&P 500 hit an intraday record on Friday while the Dow Jones Industrial Average reached its highest point so far this year.
As “stocks have found a footing, people aren’t as afraid of the potential negative” stemming from recent instability in oil prices and Greece, said Wayne Kaufman, chief market analyst at Phoenix Financial Services in New York. “That’s allowed stocks to start breaking out of the channel that they’ve been stuck in since the beginning of the year,” he said.
With the bulk of US earnings season already in the bag, and positive on the whole, analysts are looking ahead to consumer giant Wal-Mart’s fourth-quarter results this week. Of the 391 S&P 500 companies that have reported earnings, about 71.1 per cent have topped profit expectations, above the historical average, Thomson Reuters data show.
As stocks hit new highs, market participants will be paying close attention to developments in Greece, as a new bailout agreement has not been reached and the deadline is 28 February.