Wall Street surged on Monday (US time) in a broad rally as investors sought bargains among sectors hardest-hit by the coronavirus recession, now limping toward its ninth month.
All three major US stock indexes were solidly higher on the heels of the longest weekly losing streak in over a year for both the S&P 500 and the Dow.
But energy financials and industrials , which suffered the most bruising blows from the economic shutdown, enjoyed among the largest percentage gains among major S&P 500 sectors, all of which were up more than 1 per cent.
“Investors are looking for opportunities,” said Oliver Pursche, president of Bronson Meadows Capital Management in Fairfield, Connecticut. “And financials and industrials have underperformed in the last few months, so it’s not surprising to see rotation into them.”
But even with Monday’s jump, the indexes are only days away from closing the books on their first monthly declines since March, when markets were sent into a freefall by pandemic-related lockdowns.
“September is usually a rough month for markets,” Pursche added. “But people are going to get their third-quarter statements and be very happy with the sharp rebound.”
Indeed, with the third quarter’s expected gains, the S&P is on course for its best two-quarter winning streak since 2009, and the Nasdaq is set for its largest advance since 2000.
Market leaders Apple Inc, Amazon.com and Microsoft Corp once again gave the biggest boost to the S&P 500 and the Nasdaq, and 29 of 30 constituents of the blue-chip Dow were in the black.
Data released over the weekend showed Chinese industrial profits grew for the fourth straight month, evidence of progress in the global recovery from the pandemic recession.
The lack of a COVID-19 vaccine and an additional fiscal stimulus package from Washington nearly two months after emergency unemployment expired for millions of Americans have weighed on the markets in recent sessions.
In late trade, the Dow Jones is up 1.7 per cent, the S&P 500 has gained 1.7 per cent and the Nasdaq has added 1.8 per cent. It sets up the ASX for a bright start, with futures at 5.06am AEST pointing to a jump of 29 points, or 0.5 per cent, at the open. American Airlines Group announced late Friday that it has secured a $US5.5 billion government loan, and might access more. The news sent the commercial carrier’s stock up 4.5 per cent.
This also gave a lift to the broader airline sector, which was badly stricken by pandemic-related restrictions and plunging demand. The S&P 1500 Airlines index gained 4.4 per cent.
Boeing extended Friday’s gains, rising 6.1 per cent after Federal Aviation Administration Chief Steve Dickson said the agency was set to conduct a 737 MAX evaluation flight this week.
Devon Energy said it would buy peer WPX Energy for $US2.56 billion, sending their shares jumping 11.3 per cent and 15.9 per cent, respectively.
Ride-hailing platform Uber rose 3.2 per cent after a judge ruled the company could resume operations in London.
Advancing issues outnumbered declining ones on the NYSE by a 6.30-to-1 ratio; on Nasdaq, a 3.00-to-1 ratio favoured advancers.
The S&P 500 posted 6 new 52-week highs and no new lows; the Nasdaq Composite recorded 41 new highs and 25 new lows.
Source: Thanks smh.com