Stock market records another positive day
Stocks shook off a wobbly start and closed broadly higher Monday, adding to the market’s recent run of solid gains.
The S&P 500 climbed 0.4 percent after wavering between small gains and losses in the early going. Banks, companies that depend on consumer spending and communications companies accounted for a big slice of the gains. Health care was the only sector to fall. Bond yields were mostly higher, another sign of optimism among traders. Oil prices fell.
Investors are balancing cautious optimism about the reopening of businesses shut down because of the coronavirus pandemic against worries that the civil unrest across the U.S. over police brutality and racism could disrupt the economic recovery and widen the outbreak.
The daily protests, which began last week in Minneapolis and have since turned violent in multiple cities, are not weighing on the stock market, at least so far.
“The market has been expecting a springtime for economic activity,” said Mike Zigmont, head of trading and research at Harvest Volatility Management. “If these events derail the animal spirits that the markets have been counting on across the country, then I think they will have an impact. But investors are dismissing it as a short-term, nonevent.”
The S&P 500 rose 11.42 points to 3,055.73. The Dow Jones Industrial Average gained 91.91 points, or 0.4 percent, to close at 25,475.02. The Nasdaq composite climbed 62.18 points, or 0.7 percent, to 9,552.05. Smaller company stocks had some of the biggest gains. The Russell 2000 index picked up 11.34 points, or 0.8 percent, finishing at 1,405.37.
The stock market is coming off its second month of solid gains. Stocks have now recouped most of their losses after the initial economic fallout from the coronavirus knocked the market into a breathtaking 34 percent skid in February and March. The S&P 500 is now down just under 10 percent from its all-time high in February.
The Federal Reserve and Congress have pledged unprecedented amounts of aid for the economy. That helped spur the market’s move higher from its March lows. Now investors are betting that the worst of the recession has already passed, or will soon, as governments around the country and around the world slowly lift restrictions meant to corral the outbreak.
“I think we are through the worst of it for sure, and the markets reflect that in the bounce we’ve seen,” said David Trainer, CEO of investment researcher New Constructs.