NEW YORK, Sept 28 — Wall Street was set to surge at the open today following the longest weekly losing streak in a year for the S&P 500 and the Dow, with investors piling into shares of beaten-down sectors, including banks and travel.
Delta Air Lines, United Airlines, American Airlines Group Inc rose between 2 per cent and 4 per cent in premarket trading, while cruise operators Norwegian Cruise Line, Royal Caribbean Cruises Ltd and Carnival Corp gained more than 3.5 per cent each.
American Airlines Group Inc said on Friday it had secured a US$5.5 billion (RM22.9 billion) Treasury loan and could tap up to US$2 billion more in October depending on the allocation of extra funds under a US$25 billion loan package for airlines.
Worries over rising coronavirus cases and waning hopes of more fiscal stimulus have led to a spike in market volatility in the past few weeks, and analysts expect trading to remain choppy in the run up to the Nov. 3 presidential election.
Wall Street’s main indexes ended higher on Friday, helped by technology stocks, but the Dow Jones and the benchmark S&P 500 indexes posted their fourth straight weekly decline - the longest such streak since August 2019.
US big banks JPMorgan Chase & Co, Goldman Sachs Group Inc, Morgan Stanley, Wells Fargo & Co and Bank of America Corp and Citigroup Inc added between 1.0 per cent and 1.9 per cent.
“Traders tend to gravitate toward those groups that are most oversold because they have the greatest upside potential,” said Sam Stovall, chief investment strategist at CFRA in New York, referring to banks and travel-related stocks.
Optimism spilled over from Asian trading hours after data over the weekend showed profits at China’s industrial firms grew for the fourth straight month in August.
“All of this data reminds investors that we’re not headed for a new bear market or a new recession,” Stovall said.
At 8:37 a.m. ET, Dow e-minis were up 372 points, or 1.38 per cent, S&P 500 e-minis were up 47.5 points, or 1.44 per cent, and Nasdaq 100 e-minis were up 213.5 points, or 1.92 per cent.
Shares of technology-related stocks including Facebook Inc , Alphabet Inc, Amazon.com Inc, Apple Inc and Netflix Inc, seen as relatively safe assets during economic uncertainty, rose between 1.8 per cent and 2.7 per cent.
Boeing shares rose 3.5 per cent after the FAA Chief Steve Dickson said the agency is set to conduct a 737 MAX evaluation flight this week, a key milestone as the planemaker aims for approval to resume flight.
Devon Energy Corp jumped 12.2 per cent after the oil and gas producer said it will buy peer WPX Energy Inc for US$2.56 billion. WPX Energy shares surged 13.5 per cent.
Shares of chip gear makers KLA Corp tumbled 2.5 per cent, while Lam Research Corp and Applied Materials Inc fell more than 1 per cent as the United States imposed curbs on exports to China’s biggest chip maker SMIC, citing risk of military use. — Reuters
