S&P 500, Dow extend rally on hopes of swift economic rebound. Wall Street’s major indexes rose on Monday, building on last week’s sharp gains after a surprisingly upbeat jobs report raised bets of a swift recovery from a coronavirus-driven downturn.
Among the leading gainers on the S&P 500 were shares of cruise line operators Carnival Corp and Norwegian Cruise Line Holdings Ltd, up 12% and 13.5%, respectively. The S&P 1500 airlines index jumped 6.8%.
Planemaker Boeing Co advanced 11.4%, adding to its 40% surge last week.
Aiding sentiment, major oil producers agreed to extend a deal on record output cuts over the weekend. The energy sector climbed 3.6%, the most among the 11 major S&P sectors. [O/R]
Other cyclical sectors including financials, and industrials, as well as consumer discretionary provided the biggest boost to the benchmark index.
The tech-heavy Nasdaq, however, dipped on Monday, after hitting an intraday record high in the previous session as data showed the unemployment rate in May unexpectedly fell.
“Most likely, May will have marked the peak of massive job losses,” Magdy El Mihdawy, senior strategist at Cantor Fitzgerald said in a note. “While the recovery in jobs will likely take several years, the market is only focused on the trough.”
The benchmark S&P 500 and the Dow are now 5.5% and 7.4% away from their respective closing highs, after surging more than 45% from their pandemic lows hit on March 23.
The S&P 500 is now about 1% away from recouping all of its losses this year.
The focus this week will be on the Federal Reserve’s two-day policy meeting, ending on Wednesday, where the jobs report is expected to be discussed.
It would be the first meeting since April when Fed Chair Jerome Powell said the U.S. economy could feel the weight of the economic shutdown for more than a year.
At 10:04 a.m. ET, the Dow Jones Industrial Average was up 254.55 points, or 0.94%, at 27,365.53, the S&P 500 was up 9.33 points, or 0.29%, at 3,203.26. The Nasdaq Composite was down 20.15 points, or 0.21%, at 9,793.93.
Electric carmaker Tesla Inc rose 1.4% after China sales of Shanghai-made Model 3 vehicles more than tripled in May, compared with the previous month.
Advancing issues outnumbered decliners for a 4.09-to-1 ratio on the NYSE and a 2.50-to-1 ratio on the Nasdaq.
The S&P index recorded six new 52-week highs and no new low, while the Nasdaq recorded 44 new highs and no new low.
