Wall Street’s main indexes rose for a fourth straight session on Monday (US time) on optimism that a coronavirus relief package would eventually come around, while investors geared up for the third-quarter corporate earnings season.
Technology stocks provided the biggest boost to all three main indexes as Apple jumped 5.3 per cent ahead of a special event on Tuesday, which most analysts believe will be used to unveil the new iPhone with 5G capabilities.
Amazon.com climbed 5.1 per cent ahead of its annual Prime Day shopping event on October 13 and 14.
In mid-afternoon trade, the Dow has added 1.1 per cent, the S&P 500 is up 2 per cent and the Nasdaq has surged by 3.3 per cent. It sets up the ASX for gains, with futures at 5.15am AEDT pointing to a jump of 46 points, or 0.8 per cent, at the open.
The Trump administration on Sunday called on Congress to pass a stripped-down coronavirus relief bill as negotiations on a broader package ran into resistance.
“The market has come to a realisation that stimulus is going to be coming … no matter who is the president. It’s probably going to be coming about a month out from now,” said Robert Pavlik, chief investment strategist and senior portfolio manager at SlateStone Wealth.
A recent Reuters/Ipsos poll showed Americans were steadily losing confidence in President Donald Trump’s handling of the COVID-19 pandemic, with his net approval on the issue hitting a record low.
Growing expectations of a Democratic win in next month’s presidential election have also helped Wall Street’s main indexes climb to one-month highs as a victory for Democratic nominee Joe Biden could ease the trade war with China and resulting tariff pressures on the US economy.
The S&P 500 was less than 2 per cent away from surpassing its record closing high from September 2 that would mark a complete recovery from a 9 per cent pullback.
With the October 15 presidential debate officially cancelled, Trump plans to travel to key battleground states this week as his doctor declared he was no longer a transmission risk for the novel coronavirus.
Results from big US banks will be in focus this week, with JPMorgan & Co and Citigroup set to report on Tuesday. Bank shares gained 0.6 per cent.
Overall, analysts expect third-quarter earnings for S&P 500 companies to fall 20.7 per cent from a year earlier, smaller than a 30.6 per cent slump in the second quarter.
The consumer discretionary index hit an all-time high and, along with tech and communication services , rose the most among major S&P sectors.
The energy index was the weak spot, as oil prices dropped on easing supply worries.
Twitter gained 5 per cent after Deutsche Bank upgraded the social media company’s shares to “buy” on expectations of continued growth in 2021.
Advancing issues outnumbered decliners by a 1.68-to-1 ratio on the NYSE and by a 1.49-to-1 ratio on the Nasdaq.
The S&P index recorded 65 new 52-week highs and no new low, while the Nasdaq recorded 149 new highs and 10 new lows.
Source: Thanks smh.com