Wall Street rises with economic hopes; bank stocks jump

By Caroline Valetkevitch (Reuters) - U.S. stocks rose on Wednesday, with the S&P 500 closing above 3,000 for the first time since March 5, as the further easing of lockdowns lifted optimism for an economic recovery.

Reuters May 28, 2020 04:07:00 IST
Wall Street rises with economic hopes; bank stocks jump

Wall Street rises with economic hopes bank stocks jump

By Caroline Valetkevitch

(Reuters) - U.S. stocks rose on Wednesday, with the S&P 500 closing above 3,000 for the first time since March 5, as the further easing of lockdowns lifted optimism for an economic recovery.

Bank stocks powered the day's advance, with the S&P 500 financial index <.SPSY> leading gains among major sectors. The index rose nearly 10% over the past two sessions for its biggest two-day increase since April 8-9.

Shares of JPMorgan Chase & Co was the leading point gainer in the financial index, rising 5.8% as the stock surged for a second day in a row. The bank's chief executive, Jamie Dimon, said Tuesday he expects JPMorgan will boost its credit reserves again in the second quarter, but said there are signs the economy is regaining its footing.

After-the-bell on Wednesday, the head of JPMorgan's corporate and investment banking division said second-quarter revenues are on track to be more than 50% higher than the same period last year.

Continued easing of lockdowns, optimism about an eventual COVID-19 vaccine and massive U.S. stimulus have been driving the market's recent gains. On Wednesday, Walt Disney Co announced plans to begin reopening its Walt Disney World resort in Florida, the world's largest theme park, in phases beginning July 11, and MGM Resorts said it would reopen its four Las Vegas casinos on June 4.

"It's all about liquidity and the hopes that the economy will eventually do well," said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.

"The rally will continue, but I don't think it will continue without pullbacks," he said, noting that weak second-quarter earnings could give investors a "reality check."

Tech-related shares underperformed the broader market on Wednesday after leading the recent rally.

The Dow Jones Industrial Average <.DJI> rose 553.16 points, or 2.21%, to 25,548.27, the S&P 500 <.SPX> gained 44.36 points, or 1.48%, to 3,036.13, and the Nasdaq Composite <.IXIC> added 72.14 points, or 0.77%, to 9,412.36.

Amid the recent gains, U.S. tensions with China have cast a cloud on markets.

President Donald Trump said Tuesday that Washington would announce its response to China's planned national security legislation on Hong Kong before the end of the week. Secretary of State Mike Pompeo said Wednesday that Hong Kong no longer warrants special treatment under U.S. law as it did when it was under British rule, potentially a big blow to its status as a major financial hub.

Tech-related shares are among the most sensitive to Chinese growth, said Sameer Samana, senior global market strategist at Wells Fargo Investment Institute in St. Louis.

"If the market is going to go higher from here, you're going to have to have broader participation, but you are going to need those large-cap tech companies to be along for the ride because they make up such a large portion of the benchmark," Samana said.

Also on Wednesday, the Federal Reserve's Beige Book report showed that U.S. businesses continued to be hammered by the effects of the novel coronavirus epidemic into the middle of May.

Advancing issues outnumbered declining ones on the NYSE by a 3.81-to-1 ratio; on Nasdaq, a 2.21-to-1 ratio favored advancers.

The S&P 500 posted seven new 52-week highs and no new lows; the Nasdaq Composite recorded 41 new highs and 10 new lows.

Volume on U.S. exchanges was 12.86 billion shares, compared to the 11.33 billion average for the full session over the last 20 trading days.

(Reporting by Caroline Valetkevitch; Additional reporting by Medha Singh and Susan Mathew in Bengaluru; Editing by Leslie Adler)

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

Updated Date:

TAGS:

Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.

also read

Aurora Cannabis plans more layoffs, facility closures amid industry turmoil
Business

Aurora Cannabis plans more layoffs, facility closures amid industry turmoil

By Arunima Kumar (Reuters) - Aurora Cannabis on Tuesday announced a new round of staff reductions and plans to shut five facilities over the next two quarters, as the COVID-19 pandemic pummels the cash-crunched cannabis industry. For most marijuana companies in Canada, which legalized recreational cannabis in October 2018, profits have proven elusive due to fewer-than-expected retail stores, cheaper rates on the black market and slow overseas growth. The industry has been further hit by the COVID-19 crisis, which has also upended financial markets, making it harder to get investor dollars

India levies charge on some steel imports from China, Korea, Vietnam
Business

India levies charge on some steel imports from China, Korea, Vietnam

NEW DELHI (Reuters) - India has imposed an anti-dumping duty on flat rolled steel products that are plated or coated with alloy of aluminium and zinc originating in, or from China, Vietnam and South Korea, according to a government order https://www.cbic.gov.in/resources//htdocs-cbec/customs/cs-act/notifications/notfns-2020/cs-add2020/csadd16-2020.pdf issued on Tuesday. The duty will be in the range of $13.07-$173.10 per tonne for 5 years, according to the statement

Gold vaults to highest since October 2012 as dollar stumbles
Business

Gold vaults to highest since October 2012 as dollar stumbles

By Diptendu Lahiri (Reuters) - Gold prices surged to their highest since October 2012 on Tuesday, driven by a weakness in the U.S. dollar and widespread monetary stimulus packages by central banks as a jump in coronavirus cases dents the economic outlook