Benchmarks closed in the green on Monday as signs of economic rebound overshadowed civil unrest amid coronavirus pandemic and rising U.S.-China tensions.
The Dow Jones Industrial Average (DJI) rose 91.91 points, or 0.4%, to close at 25,475.02 and the S&P 500 rose 11.42 points, or 0.4% to close at of 3,055.73. While, the Nasdaq Composite Index closed at 9,552.05, adding 62.18 points, or 0.7%. The fear-gauge CBOE Volatility Index (VIX) increased 2.6%, to close at 28.23. Advancing issues outnumbered declining ones for 3.26-to-1 ratio on the NYSE and a 1.58-to-1 ratio on the Nasdaq favored advancers.
How Did the Benchmarks Perform?
On Monday, tech giants Facebook, Inc. FB Apple Inc. AAPL and Amazon.com, Inc. AMZN rose 3%, 1.2% and 1.2% respectively, that provided the biggest lift to the S&P 500 and the Nasdaq. Out of the 11 major S&P 500 sectors, 10 closed in the positive, led by the real estate, which added 2.1%.
Apple sports a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The health care sector ended in the red, 1% lower, as shares of Pfizer Inc. PFE stumbled 7.2%. The company reported disappointing news concerning its Phase 3 early breast cancer Palbociclib Collaborative Adjuvant Study (PALLAS) trial results.
On the other hand, the Dow was boosted by The Boeing Company’s BA 3.8% gain, breaking its two-day losing streak.
Overall, the S&P index recorded 20 new 52-week highs and no new lows. Meanwhile, Nasdaq recorded 98 new highs and 10 new lows.
Economic Rebound Soothes Civil Unrest
On Monday, the Institute for Supply Management (ISM) reported that its manufacturing index climbed to 43.1 in May, in line with the consensus estimate and above the 11-year low of 41.5 in April. The figures indicate expansion in the overall economy after April’s contraction as many panelists and their suppliers returned to work late in the month, on easing of coronavirus-led lockdowns.
Additionally, economy reopening in the United States helped shares of airlines, cruises and hotels to end higher. Shares of Carnival Corporation & Plc CCL and Royal Caribbean Cruises Ltd. RCL rose 6.7% and 7.3%, respectively, while Marriott International, Inc. MAR ended the day 7.4% higher.
The reports overshadowed news of National Guard troops being deployed in 15 states and Washington, D.C. in an attempt to put an end to civil unrest. Protests were held across major cities over the death of George Floyd, in police custody.
The civil unrest in multiple states have prompted retailers,Target Corporation TGT and Walmart Inc. WMT to close down portions of their stores. While, ecommerce giant Amazon had to scale back deliveries.
China to Halt American Farm Goods Purchase
On Monday, Reuters and Bloomberg News reported that Chinese government officials have asked major state-run agricultural companies to pause purchases of some American farm goods which included pork and soybeans.
Earlier last week, China had tightened its control over Hong Kong by implementing a new national-security law. To which, the Trump administration on May 29 announced a number of measures against China, paving way for the United States to end Hong Kong’s special status.
However, none of the measures interfere with the Phase One trade deal closed before the coronavirus outbreak.
Stocks that Made Headline
Credit Suisse to Own 51% Stake in China Securities JV
As China opened its financial markets to foreign firms with the removal of restrictions on ownership effective Apr 1, Credit Suisse Group AG CS became the latest foreign bank to take the majority stake in its China securities joint venture (JV). (Read More)
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Marriott International, Inc. (MAR) : Free Stock Analysis Report
Target Corporation (TGT) : Free Stock Analysis Report
The Boeing Company (BA) : Free Stock Analysis Report
Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
Apple Inc. (AAPL) : Free Stock Analysis Report
Carnival Corporation (CCL) : Free Stock Analysis Report
Pfizer Inc. (PFE) : Free Stock Analysis Report
Walmart Inc. (WMT) : Free Stock Analysis Report
Credit Suisse Group (CS) : Free Stock Analysis Report
Royal Caribbean Cruises Ltd. (RCL) : Free Stock Analysis Report
Facebook, Inc. (FB) : Free Stock Analysis Report
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