Wall Street’s major averages opened higher on Monday as bond markets calmed after a month-long selloff, while encouraging updates on the vaccine and stimulus fronts strengthened bets over a swift economic recovery.

The U.S. flag is seen over the company logo for Johnson & Johnson to celebrate the 75th anniver

FILE PHOTO: The U.S. flag is seen over the company logo for Johnson & Johnson to celebrate the 75th anniversary of the company’s listing at the New York Stock Exchange (NYSE) in New York, U.S., September 17, 2019. REUTERS/Brendan McDermid

REUTERS: Wall Street’s major averages rose 1.5per cent on Monday as bond markets calmed after a month-long selloff, while encouraging updates on the vaccine and stimulus fronts strengthened bets over a swift economic recovery.

Shares of cruise liner and hotel operators, and carriers including Carnival Corp, Hilton, Delta Air Lines Inc and American Airlines gained between 1.8per cent and 4.6per cent.

Johnson & Johnson rose 1.8per cent as it began shipping its single-dose vaccine after it became the third authorized COVID-19 vaccine in the United States over the weekend.

President Joe Biden scored his first legislative win as the House of Representatives passed his US$1.9 trillion coronavirus relief package early Saturday. The bill now moves to the Senate.

U.S. bond yields eased on Monday after a swift rise last month on expectations of accelerated inflation due to bets on an economic rebound. The U.S. 10-year treasury yield eased to 1.446per cent after hitting a one-year high of 1.614per cent.

“The angst over rising yields is going to subside with yield levels clearly calming down while positive vaccine and stimulus updates will also support (markets) as it’s very good news for the economy and corporate earnings,” said Art Hogan, chief market strategist at National Securities in New York.

All major S&P sectors were higher with those that stand to benefit more from an economic rebound outperforming. Financials, energy and materials gained between 2per cent to 3per cent.

Wall Street’s main indexes ended lower last week, with the Nasdaq suffering its worst week in four months, as a rise in long-dormant yields signaled bonds are more serious investment competition, sparking a pullback in high-valuation tech stocks.

Apple, Microsoft Corp, Facebook Inc and Amazon.com Inc rebounded between 0.4per cent and 2per cent on Monday.

At 9:40 a.m. ET, the Dow Jones Industrial Average rose 503.46 points, or 1.63per cent , to 31,435.83, the S&P 500 gained 56.93 points, or 1.49per cent, to 3,868.08 and the Nasdaq Composite gained 194.58 points, or 1.47per cent, to 13,386.92.

Investors will look to ISM’s U.S. manufacturing activity data for February at 10 a.m. ET which is expected to be largely unchanged from January.

Warren Buffett’s enthusiasm for the future of America and his company Berkshire Hathaway Inc has not been dimmed by the coronavirus pandemic, according to his annual letter to investors. Berkshire’s shares rose about 2.3per cent.

Perrigo Company Plc jumped about 9per cent as the consumer healthcare products company said it would sell its underperforming generic drugs business for US$1.55 billion.

Advancing issues outnumbered decliners by a 9.4-to-1 ratio on the NYSE and by a 9.2-to-1 ratio on the Nasdaq.

The S&P 500 posted 13 new 52-week highs and no new low, while the Nasdaq recorded 102 new highs and 12 new lows.

(This story corrects headline to say Wall St “jumps”, instead of “set for higher open”)

(Reporting by Medha Singh in Bengaluru; Editing by Maju Samuel)



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