Wall Street rallies as some US states relax lockdown restrictions; all major indexes claw back, gain over 1%

The indexes are all now within 20 percent of their record closing highs reached in February, with the benchmark S&P 500 on track for its best month since 1987, after trillions of stimulus dollars helped US equities recover from March lows.

Reuters April 28, 2020 07:04:20 IST
Wall Street rallies as some US states relax lockdown restrictions; all major indexes claw back, gain over 1%

New York: Wall Street advanced on Monday as investors girded for a busy earnings week while turning a hopeful eye toward several US states that are relaxing shutdown restrictions put in place to curb the spread of the COVID-19 pandemic.

All three major US stock averages gained more than 1 percent, having clawed back much of the ground lost since the coronavirus crisis brought the economy to a grinding halt.

The indexes are all now within 20 percent of their record closing highs reached in February, with the benchmark S&P 500 on track for its best month since 1987, after trillions of stimulus dollars helped US equities recover from March lows.

But some analysts believe gains may be limited unless there is progress in finding treatments for the disease.

Several states have begun easing shutdowns, and market participants will closely monitor whether a second wave of infections will hinder efforts to revive economies and get Americans back to work following crushing job losses.

“There’s cautious optimism that the economy across the country is moving toward restarting,” said Robert Pavlik, chief investment strategist, senior portfolio manager at SlateStone Wealth LLC in New York. “The market is looking out 6 to 9 months, but there are a number of things that could push that optimism right out the window, primarily a sharp spike in the number of COVID-19 cases.”

Wall Street rallies as some US states relax lockdown restrictions all major indexes claw back gain over 1

Representative image. Reuters

Economists expect the US economy to have shrunk in the first quarter at a 4 percent annualized rate. The Commerce Department is due to release its first take on first-quarter GDP on Wednesday.

Investors will also pay close attention to the US Federal Reserve when it concludes its monetary policy meeting on Wednesday.

In afternoon trading, the Dow Jones Industrial Average rose 313.94 points, or 1.32 percent, to 24,089.21, the S&P 500 gained 37.52 points, or 1.32 percent, to 2,874.26 and the Nasdaq Composite added 80.40 points, or 0.93 percent, to 8,714.92.

All 11 major sectors of the S&P 500 were higher, with financials posting the largest gains, helped by US Treasury yields, which rose for the second straight session.

A spate of high-profile earnings is expected this week, including Caterpillar Inc, Alphabet Inc, Boeing Co, Facebook Inc, Apple Inc, Amazon.com Inc and others.

Analysts expect first-quarter S&P 500 earnings to have dropped by 15 percent from last year, a dramatic reversal from the 6.3 percent year-on-year growth forecast at the start of the year, according to Refinitiv data.

The US Supreme Court ruled in favor of health insurers seeking Obamacare payments from the government. The S&P 1500 Managed Care index was up 0.5 percent.

Tesla Inc jumped 9.2 percent and gave the Nasdaq its biggest boost after a report said the company is calling some workers back to its California vehicle-assembly plant next week.

Apple Inc slipped 0.2 percent following a report indicating the company was postponing a production ramp-up of its flagship iPhone.

The CBOE Volatility index, a gauge of investor anxiety, slipped for its fourth consecutive session to touch a more than seven-week low.

Crude oil prices, under pressure amid a supply glut and plunging demand, once again plummeted, falling 22.9 percent.

Advancing issues outnumbered declining ones on the NYSE by a 3.38-to-1 ratio; on Nasdaq, a 4.07-to-1 ratio favored advancers.

The S&P 500 posted 5 new 52-week highs and no new lows; the Nasdaq Composite recorded 58 new highs and 7 new lows.

Updated Date:

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