Wall Street surges on signs of economic rebound
Wall Street jumped in a broad rally on Wednesday, closing ground on all-time highs as signs of recovery from mandated economic shutdowns helped investors look beyond ongoing social unrest and pandemic woes.
Traders wear masks as they work on the floor of the New York Stock Exchange as the outbreak of the coronavirus disease (COVID-19) continues in the Manhattan borough of New York, U.S., May 28, 2020. REUTERS/Lucas Jackson
Financials, industrials and tech led the three major U.S. stock indexes well into the black, with the S&P 500 and the Nasdaq on course to post their fourth straight day of solid gains.
The Nasdaq, the S&P 500 and the Dow have rebounded sharply from March lows hit as coronavirus-related lockdowns shocked the stock market, and they are now about 1.6%, 8.1%, and 11.6%, respectively, away from overtaking record closing highs set in February.
The Nasdaq 100 .NDX is now within half a percent of its February record.
“With the market returning to all-time highs, there’s sentiment out there that the economy will get better in the second half of the year,” said Joseph Sroka, chief investment officer at NovaPoint in Atlanta. “There are a number of gates in the way between now and 2021, but barring another COVID-like event, there should be a fairly robust return to growth.”
Nationwide protests over the death of an unarmed black man in police custody extended through their eighth night as protesters ignored curfews, but violence subsided after President Donald Trump threatened to deploy the military.
A spate of grim economic data was not as bad as economists feared, with ADP reporting much fewer private-sector job cuts in May than expected.
Market participants now await the U.S. Labor Department’s more comprehensive May jobs report, which is expected to show unemployment soaring to a historic 19.7%
The Dow Jones Industrial Average .DJI rose 440.59 points, or 1.71%, to 26,183.24, the S&P 500 .SPX gained 38.06 points, or 1.24%, to 3,118.88 and the Nasdaq Composite .IXIC added 75.11 points, or 0.78%, to 9,683.48.
Of the 11 major sectors in the S&P 500, all but healthcare .SPXHC were in positive territory.
Boeing Co (BA.N) gave the biggest boost to the blue-chip Dow, its shares rising 10.4% following news that billionaire investor Daniel Loeb’s Third Point had taken a stake in the company.
Lyft Inc (LYFT.O) jumped 10.4% after the ride-sharing platform reported rides increased 26% in May.
Microchip Technology Inc (MCHP.O) surged 12.5% after the chipmaker raised its forecast for current-quarter sales and profit.
Teleconferencing firm Zoom Communications Inc (ZM.O) nearly doubled its annual sales expectations, but also reported a sharp rise in costs. Its shares were up 5.8%.
Cosmetics maker Coty Inc’s (COTY.N) rose 10.9% after announcing it was in talks to collaborate on a beauty line with reality TV star Kim Kardashian West.
Campbell Soup Co’s (CPB.N) beat earnings expectations and hiked its full-year forecast, but troubles meeting surging consumer demand sent its shares down 4.9%.
Advancing issues outnumbered declining ones on the NYSE by a 3.62-to-1 ratio; on Nasdaq, a 2.33-to-1 ratio favored advancers.
The S&P 500 posted 30 new 52-week highs and no new lows; the Nasdaq Composite recorded 89 new highs and three new lows.