| Stocks Close Higher On Blowout GDP Report  Image: Bigstock Stocks closed up yesterday. Off their highs of the day, but a solid gain nonetheless.
However, all of the major indexes are on pace for another lower weekly close.
As mentioned yesterday, with Europe grappling with an increase in virus cases and talk of more shutdowns, that fear has spooked U.S. investors given the rise in cases here in the states as another shutdown would hamper growth.
Fortunately, our economy has been on a strong path of recovery. In fact, it's been the fastest economic rebound in history. And because our economy was so strong going into the pandemic, it's allowed us to strongly bounce back.
That economic strength was on full display yesterday morning when Q3 GDP came in at a whopping 33.1%, beating the estimates for 30.9%. This was the largest growth rate ever recorded.
And with expectations for more growth in Q4 (especially if Congress can pass another stimulus bill after the election), not to mention expectations for all of 2021 to grow at the fastest pace in 38 years, it looks like there's a lot more upside to go for both the economy and stocks.
More good news was seen with yesterday's Weekly Jobless Claims falling more than expected (down -40,000) to come in at 751K vs. views for 758K.
Election uncertainty will persist at least thru a portion of next week, or longer if it's close, given the additional time to count mail-in ballots.
But I'm reminded of what Goldman Sachs' Michael Cahill and Alec Phillips wrote in a note last month; "it seems fairly likely that there should be enough information on election night from states that will report results quickly for the market to be able to gauge the likely winner." "In other words, the S&P can trade the likely outcome, even if the AP does not call the race."
We shall see.
In the meantime, we'll get more earnings rolling in today, and another 1,877 next week.
And we'll get another look at the economy with the Personal Income and Outlays report, the Chicago Purchasing Managers Index, and Consumer Sentiment.
As the economy continues to improve, that should be good news for stocks.
Best, 
Kevin Matras Executive Vice President, Zacks Investment Research | Most Popular Articles from Zacks.com | 
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