Wall Street climbs on stimulus hopes, as S&P, Nasdaq hit multi-month highs

By Chuck Mikolajczak NEW YORK (Reuters) - The three major averages on Wall St notched their fourth gain in five sessions on Wednesday as investors again bet on a swift economic recovery from coronavirus-driven lockdowns and the potential for more stimulus measures from the Federal Reserve.

Reuters May 21, 2020 02:06:30 IST
Wall Street climbs on stimulus hopes, as S&P, Nasdaq hit multi-month highs

Wall Street climbs on stimulus hopes as SP Nasdaq hit multimonth highs

By Chuck Mikolajczak

NEW YORK (Reuters) - The three major averages on Wall St notched their fourth gain in five sessions on Wednesday as investors again bet on a swift economic recovery from coronavirus -driven lockdowns and the potential for more stimulus measures from the Federal Reserve.

The S&P 500 stands at a two-month high and was briefly above its 100-day moving average, a closely watched technical indicator that has acted as a resistance level. The Nasdaq <.IXIC> finished at its highest close in three months and was less than 5% below record levels, as shares of Facebook Inc and Amazon.com Inc surged to all-time highs.

Gains were broad-based. The small-cap Russell 2000 index <.RUT>, which usually leads gains out of a recession, outperformed the large-cap indexes.

Minutes from the Federal Reserve's most recent policy meeting showed the central bank pledged to act as appropriate to support the economy until it is on track to recovery, a sentiment that Fed Chair Jerome Powell has voiced in recent days.

"We have way lower interest rates for the foreseeable future, so that effects the multiple that we have to buy discounted stocks at," said Kim Forrest, chief investment officer at Bokeh Capital Partners in Pittsburgh. "And if you give yourself a little bit more time, is it crazy to think everything is going to come back in two years and you are going to hold it three to five years?"

Still, with economic data likely to be dismal in the coming weeks, there is concern that stocks may have gotten ahead of themselves, with the S&P up nearly 33% from its March 23 closing low.

Unofficially, the Dow Jones Industrial Average <.DJI> rose 1.52% to end at 24,575.9 points, while the S&P 500 <.SPX> gained 1.67%, to 2,971.61. The Nasdaq Composite <.IXIC> climbed 2.08% to 9,375.78.

Lawmakers in the U.S. House of Representatives plan to vote next week on giving small businesses more time to utilize their coronavirus aid under the Paycheck Protection Program, House Speaker Nancy Pelosi said on Wednesday.

As states across the country begin to loosen restrictions, hopes for an economic rebound have grown. The NYSE Arca airlines index <.XAL> jumped as Delta Air Lines Inc's chief executive officer said he was confident travel will return in the next 12 to 18 months.

Target Corp shares declined after the big box retailer reported a 64% plunge in quarterly profit, as costs related to the coronavirus outbreak outweighed a surge in online sales.

(Reporting by Chuck Mikolajczak in New York; Additional reporting by Ambar Warrick and Medha Singh in Bengaluru; Editing by Leslie Adler)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

France, Germany to agree to NATO role against Islamic State - sources
| Reuters
World

France, Germany to agree to NATO role against Islamic State - sources | Reuters

By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States

China's Xi says navy should become world class
| Reuters
World

China's Xi says navy should become world class | Reuters

BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.