NEW YORK, July 9 ― US stocks rose yesterday and the Nasdaq hit a record closing high, supported by technology shares as early signs of an economic rebound offset concern about further lockdowns due to a jump in coronavirus cases across the country.
Apple Inc and Microsoft Corp provided the biggest boosts to the Dow and S&P 500, with the S&P 500 technology index up 1.6 per cent and leading sector gains. The Nasdaq outpaced the other two major indexes, ending 1.4 per cent higher, led by Amazon.com, its fourth record closing high this month.
The number of confirmed US coronavirus cases surpassed 3 million, affecting nearly one of every 100 Americans. California, Hawaii, Idaho, Missouri, Montana, Oklahoma and Texas broke their previous daily record highs for new infections.
Investors have been weighing a string of upbeat economic data including record job additions and a rebound in the service sector in June, against the surge in US coronavirus cases recently, but the S&P 500 is still up more than 40 per cent from its March closing low.
“The market continues to ignore the potential consequences of these spikes in new coronavirus cases,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
“It's overbought,” he said. “While I don't expect this market to crash... I think investors at this juncture are playing with fire,” he said, noting the rise in safe-haven gold prices.
Adding to the optimistic tone late in the session, St. Louis Federal Reserve Bank President James Bullard told CNBC in an interview that US unemployment will likely decline to below 8 per cent “maybe even 7 per cent “ by the end of the year.
The Dow Jones Industrial Average rose 177.1 points, or 0.68 per cent, to 26,067.28, the S&P 500 gained 24.62 points, or 0.78 per cent, to 3,169.94 and the Nasdaq Composite added 148.61 points, or 1.44%, to 10,492.50.
Markets also appeared to be in a wait-and-watch mode before the beginning of the second-quarter earnings season, which kicks off next week with reports from the big Wall Street banks.
Quarterly earnings for S&P 500 companies are expected to decline nearly 44 per cent year-on-year, the steepest drop since the 2008 financial crisis, according to IBES data from Refinitiv.
Biogen Inc jumped 4.4 per cent after the company said it submitted the marketing application for its experimental Alzheimer's disease therapy, aducanumab.
Allstate Corp shares fell 4.8 per cent as the US insurer said it would buy National General Holdings Corp for about US$4 billion (RM17.1 billion), scaling up its auto insurance business. National General shares surged 65.8 per cent.
Advancing issues outnumbered declining ones on the NYSE by a 1.48-to-1 ratio; on Nasdaq, a 1.34-to-1 ratio favoured advancers.
The S&P 500 posted 20 new 52-week highs and no new lows; the Nasdaq Composite recorded 99 new highs and 18 new lows.
Volume on US exchanges was 10.40 billion shares, compared with the 12.4 billion average for the full session over the last 20 trading days. ― Reuters