Optimism About States Reopening Leads To Strength On Wall Street
(RTTNews) - Stocks moved sharply higher over the course of the trading day on Monday, extending the upward move seen in the previous session. With the advance on the day, the Nasdaq and the S&P 500 reached their best closing levels in well over a month.
The major averages pulled back off their best levels going into the close but remained firmly positive. The Dow jumped 358.51 points or 1.5 percent to 24,133.78, the Nasdaq advanced 95.64 points or 1.1 percent to 8,730.16 and the S&P 500 surged up 41.74 points or 1.5 percent to 2,878.48.
The strength on Wall Street came after New York Governor Andrew Cuomo announced plans for a phased reopening of his state's economy.
Cuomo suggested the first phase, which involves "low risk" businesses in the manufacturing and construction sectors, could begin shortly after New York's stay-at-home order expires on May 15.
The decision to announce the reopening plans comes as New York has seen as steady decline in coronavirus hospitalization rates, with Cuomo expressing optimism the worst is over.
"The numbers are on the decline. Everything we have done is working," Cuomo said during a press briefing on Sunday, "There's no doubt that we've gone at this point through the worst. And as long as we act prudently going forward, the worst should be over."
The announcement by Cuomo comes as other states, including several led by Republican governors, have already started reopening their economies.
Buying interest was also generated amid optimism about additional stimulus ahead of Federal Reserve and European Central Bank meetings later this week.
Earlier today, the Bank of Japan expanded its monetary stimulus for the second straight month to support economic and financial activities amid the coronavirus pandemic.
Financial stocks turned in some of the market's best performances on the day, with the KBW Bank Index and the NYSE Arca Broker/Dealer Index spiking by 5.6 percent and 4.8 percent, respectively.
Significant strength was also visible among housing stocks, as reflected by the 4.7 percent jump by the Philadelphia Housing Sector Index.
Steel stocks also moved sharply higher over the course of the trading session, driving the NYSE Arca Steel Index up by 4 percent.
Commercial real estate, tobacco and transportation stocks also saw considerable strength, moving higher along with most of other major sectors.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Monday. Japan's Nikkei 225 Index spiked by 2.7 percent, while Hong Kong's Hang Seng Index jumped by 1.9 percent.
The major European markets also showed significant moves to the upside on the day. While the German DAX Index soared by 3.1 percent, the French CAC 40 Index surged up by 2.6 percent and the U.K.'s FTSE 100 Index advanced by 1.6 percent.
In the bond market, treasuries moved notably lower over the course of the session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, climbed 6 basis points to 0.656 percent.
A report on consumer confidence may attract some attention on Tuesday, although traders are likely to remain focused on news on the coronavirus front.
3M (MMM), Caterpillar (CAT), Harley-Davidson (HOG), Merck (MRK), PepsiCo (PEP), Pfizer (PFE), Southwest Airlines (LUV) and UPS (UPS) are also among the companies due to report their quarterly results before the start of trading on Tuesday.