Wall Street’s three major indexes have risen as the pace of decline in business activity slowed, bolstering hopes that the worst of the coronavirus crisis was over.
The Nasdaq hit a fifth record high this month, with Apple Inc providing the biggest boost after at least three brokerages raised their price targets a day after it announced it would use its own chips for Mac computers.
The upbeat data on manufacturing and services sectors follows similar surveys from Europe earlier in the day as businesses re-opened after the health crisis resulted in a lockdown in mid-March.
The economically-sensitive financial index rose 1.3 per cent, topping gains among all the 11 major S&P sub-indexes.
Global equity markets were also boosted by US President Donald Trump’s assurance that the Phase 1 trade agreement with China was “fully intact”.
While tensions between officials in Washington DC and Beijing this year have been a cause for concern, monetary and fiscal support worth trillions of US dollars has in part powered the benchmark S&P 500, with the index just about 7.0 per cent below its February 19 record high.
“There’s a lot of money on the sidelines and as the country re-opens, as the economy recovers, that money will be forced back in,” said Thomas Hayes, managing member at Great Hill Capital LLC in New York.
“And then probably, we start to take a rest towards the end of the (northern) summer for a little bit before the economy truly starts to catch up to where the market is.”
In early trading, the Dow Jones Industrial Average was up 171.55 points, or 0.66 per cent, at 26,196.51, the S&P 500 was up 22.01 points, or 0.71 per cent, at 3,139.87. The Nasdaq Composite was up 76.17 points, or 0.76 per cent, at 10,132.64.
Nike Inc rose 1.4 per cent as brokerages raised their price targets ahead of quarterly results on Thursday.
Boeing Co’s top supplier Spirit AeroSystems Holdings slipped 5.8 per cent after it said it was seeking relief from lenders as its finances were stretched by the COVID-19 pandemic and a 737 MAX production halt.
Micron Technology Inc slipped 0.8 per cent as BMO downgraded the chipmaker’s shares to “market perform”.
Advancing issues outnumbered decliners by a 3.24-to-1 ratio on the NYSE and by a 2.71-to-1 ratio on the Nasdaq.
The S&P index recorded 18 new 52-week highs and no new low, while the Nasdaq recorded 103 new highs and four new lows.