Wall St jumps as coronavirus deaths slow


The S&P 500 was on track to recoup about $US1 trillion ($A1.6 trillion) in market value in a frantic rally after New York, the biggest US coronavirus hot spot, reported a fall in daily deaths, raising hopes that the pandemic could level off soon.

All three main stock indexes jumped more than 4.0 per cent on Monday, with gains led by utilities, real estate and consumer staples stocks – broadly considered the safest bets at times of extreme volatility.

The S&P 500 banking index soared 7.3 per cent and was set for its best day in more than a week, with Bank of America, Citigroup, Wells Fargo and JP Morgan advancing between 5.0 per cent and 8.0 per cent, tracking Treasury yields.

“Seeing signs of stabilisation in New York City is probably the most important thing given the amount of capital that’s controlled through managers that live in the area,” said Thomas Hayes, managing member at Great Hill Capital LLC in New York.

“It’s a tremendous relief for the market (but it’s) not to say that we’re through the woods yet, because we’re going to have a tough week or two ahead.”

The S&P 500 has fallen more than 20 per cent since its all-time highs in mid-February, marked by wild day-to-day price swings, as the coronavirus brought business activity to a virtual halt and sparked mass lay-offs.

Despite the slowdown in the death toll in New York, US officials girded the country for a “peak death week” from the pandemic.

Wall Street’s fear gauge fell to its lowest in two weeks but analysts cautioned against calling a bottom in equity markets.

During the financial crisis of 2007-08, the S&P 500 took months to establish its bottom even after the volatility index plummeted.

“This still looks like a case of over-optimism,” said Marios Hadjikyriacos, investment analyst at online broker XM.

“A lot of uncertainty is still in the air and there is no clear timeline for when any of these economies will be reopened, which is the most important variable for markets.”

In early trading, the Dow Jones Industrial Average was up 921.50 points, or 4.38 per cent, at 21,974.03, the S&P 500 was up 107.14 points, or 4.31 per cent, at 2,595.79 and the Nasdaq Composite was up 327.02 points, or 4.44 per cent, at 7,700.11.

Boeing Co said on Sunday it was extending the suspension of production operations at its Washington state facilities and it would stop paying about 30,000 workers this week.

The plane-maker’s shares rose 5.8 per cent but are still down nearly 60 per cent this year.

Profits for S&P 500 firms are expected to drop in the second quarter and investors fear more dire forecasts as demand across sectors including airlines, luxury goods and industrials evaporates.

Video conferencing app Zoom fell more than 8 per cent on concerns over its data privacy practices and increased competition from deep-pocketed rivals.

Source Article

Next Post

Oil dips after delays in Saudi-Russia meet

Oil prices have slumped, pulling back from last week’s gains after Saudi Arabia and Russia delayed a meeting of oil producers aimed at resolving growing worldwide oversupply as the coronavirus pandemic pummels demand. The global oil market rebounded over 35 per cent last week after sources at the Organisation of […]

You May Like