The Strategist

S&P500 hits 4,000 points for the first time in history

04/02/2021 - 03:31

The S&P 500 index, which tracks stocks of the biggest US companies by capitalisation, surpassed 4,000 points for the first time in history. Exchanges reacted positively to Biden's sweeping new plan to revamp the US economy by $2.25 trillion.

Carlos Delgado
Carlos Delgado
The S&P 500 stock index surpassed 4,000 points for the first time in history, New York Stock Exchange reported. The S&P 500 consists of the largest-capitalised companies in the US.

March was the best month for the index since November, with the S&P 500 up 4.2% in 31 days, CNBC reported. On the last day of the month, the index renewed its record high in trading, but failed to finish at its highest level. Other indices also rose on Thursday. Dow Jones is adding 58 points (0.18%) and Nasdaq index is up 230 points (+1.74% ) at the time of publication.

The growth of S&P 500 was helped by the announcement of a large-scale economic program of U.S. President Joe Biden at $2.25 trillion, which was presented by the White House the night before, explained CNBC. Biden unveiled the first part of the plan, which includes more than $621bn spent on transportation infrastructure, $650bn on improving the quality of life in American homes, nearly $680bn on industrial development, research and development and career development programs, and $400bn on care for sick and elderly Americans and people with disabilities.

This is Biden's second major economic initiative after the $1.9 trillion economic support package that the US Congress approved in March. Tax and monetary policy remains unprecedented and the gradual opening of the US economy continues to support stock markets, Craig Johnson, a technical market strategist at Piper Sandler, told CNBC. However, there are concerns on Wall Street that tax hikes will hurt the recovery in corporate earnings and share prices, the broadcaster said.