Stocks kick the week off higher as investors shrug off virus worries

Wall Street set to gain on rebound hopes despite jump in virus cases
July 8, 2020
Nasdaq hits record closing high as Wall Street rises with tech shares
July 8, 2020

Stocks kick the week off higher as investors shrug off virus worries

U.S. stocks followed Asian markets higher Monday as investors shook off worries about rising coronavirus infections in the United States and some other countries and focused on hopes for an economic recovery.

The Dow Jones industrial average climbed 459.67 points to 26,287.03, joining a worldwide upturn headlined by the best day for Chinese stocks in nearly five years. The Standard & Poor’s 500 rose 1.6% to 3,179.72, its fifth straight day of gains.

The Nasdaq Composite gained 2.2% to 10,433.65, notching another record.

Ten out of the 11 sectors in the S&P 500 index finished higher, led by gains in big technology companies and the communication-services sector. Shares of Amazon and Netflix hit all-time highs, rising 5.8% and 3.6%, respectively.

Beaten-up industries like cruise liners and airlines that are closely tied to a reopening also rose, with Norwegian Cruise Line and Royal Caribbean both rising 1%. United and American Airlines added 3.1% and 2.4%, respectively.

U.S. shares have rallied despite a surge in new cases in populous states like Florida, Texas and California. That has prompted some governors to halt reopening of businesses or to order others to re-close.

The U.S. has seen almost 2.9 million confirmed cases and more than 130,000 deaths, according to Johns Hopkins University data. Globally, there have been almost 11.5 million cases and more than 535,000 deaths.

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“The good news is that the trend in daily deaths continues to decline, but the big increase in hospitalizations is likely to push up deaths over the next couple of weeks,” Ian Shepherdson, chief economist of Pantheon Macroeconomics, said in a note. “We’re expecting to see that the rate of increase in total cases has slowed, but it needs to slow substantially further before the number of new cases per day begins to fall.”

Share prices have risen as some countries ease anti-virus measures and reopened businesses. U.S. stocks added to recent gains Monday following a stronger-than-expected jobs report for June on Friday in a holiday-shortened trading week.

Forecasters warn the surge might be too early to be sustained by uncertain economic conditions.

“While the markets are focusing on recovery and ignoring a possible potential setback from the virus spike, we believe caution is warranted more than ever,” Peter Cardillo, chief market economist at Spartan Capital Securities, said in a note.

On Monday, shares of Dominion Energy fell 11% after Berkshire Hathaway said it will acquire the company’s natural gas transmission and storage business, valued at nearly $10 billion including assumed debt. Berkshire Hathaway rose 2.4%.

The yield on the 10-year Treasury rose to 0.69% from 0.67% late Thursday. Markets were closed Friday for Independence Day. The yield tends to move with investors’ expectations for the economy and inflation.

Benchmark U.S. crude edged up 0.1% to $40.68 per barrel. Brent crude, the international standard, gained 0.9% to $43.20 per barrel.

Elsewhere, the FTSE 100 in London rose 2.1% and Frankfurt’s DAX added 1.6%. The CAC 40 in France advanced 1.5%. In Asia, the Shanghai Composite Index rose 5.7% and the Nikkei 225 in Tokyo gained 1.8%. The Hang Seng in Hong Kong added 3.8%.

Source: https://www.usatoday.com/story/money/2020/07/06/dow-stocks-rise-investors-shrug-off-virus-worries/5382777002/