Wall Street closes up on signs of economic rebound

Unofficially, the Dow Jones Industrial Average rose 1.05 per cent to end at 25,742.17 points, while the S&P 500 gained 0.82 per cent to 3,080.79. — AFP pic
Unofficially, the Dow Jones Industrial Average rose 1.05 per cent to end at 25,742.17 points, while the S&P 500 gained 0.82 per cent to 3,080.79. — AFP pic

NEW YORK, June 3 — Wall Street posted gains yesterday as market participants looked past widespread social unrest and pandemic worries to focus instead on easing lockdown restrictions and signs of economic recovery.

Tech shares, along with cyclical stocks like industrials and financials, gave the biggest lift to all three major stock indexes.

The Nasdaq, the S&P 500 and the Dow have been approaching their all-time closing highs in recent weeks and are now about 2 per cent, 9 per cent and 13 per cent, respectively, below record closing levels.

“Technicals are pushing the market higher and the market’s not paying attention to the potential problems that the protests could have on local economies,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.

Nationwide, violent protests over the death of a black man at the hands of law enforcement officers continued unabated, even as President Donald Trump vowed to unleash the military on the demonstrators.

“If the violence continues it might worsen the coronavirus’ impact on businesses,” Cardillo added. “A lot of stores would close; there’d be curfews; people wouldn’t be able to shop and that would further hurt the economy.”

But the green shoots of economic rebound driven in no small part by massive stimulus packages from Capitol Hill and the US Federal Reserve has helped fuel investor optimism.

Market participants now await Friday’s crucial jobs report from the Labor Department for a clearer picture of the extent of economic damage wrought by mandated lockdowns. The report is expected to show the unemployment rate surging to a historic 19.7 per cent.

Unofficially, the Dow Jones Industrial Average rose 1.05 per cent to end at 25,742.17 points, while the S&P 500 gained 0.82 per cent to 3,080.79.

The Nasdaq Composite climbed 0.59 per cent to 9,608.59.

The ARCA Airline index, whose constituents have been hit particularly hard by Covid-19-related restrictions, was boosted by a slow but steady increase in commercial air traffic.

Southwest Airlines Co advanced after extending buyout and paid leaves to employees in what its chief executive called an effort to “ensure survival.”

Shares of Slack Technologies Inc closed higher after Cowen initiated coverage of the workspace communication platform with an “outperform” rating.

A report that Western Union has made an offer to buy smaller rival MoneyGram International Inc The shares of both money transfer companies jumped.

Shares of luxury retailer Tiffany & Co dropped following a report from WWD that its deal with LVMH is seen as uncertain amid deteriorating US market. — Reuters

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