Wall Street gains on signs of economic recovery, Nasdaq hits record high
(Reuters) – Wall Street’s three major indexes rose on Tuesday as the pace of decline in business activity slowed, bolstering hopes that the worst of the coronavirus crisis was over.
The Nasdaq hit a fifth record high this month, with Apple Inc (AAPL.O) providing the biggest boost after at least three brokerages raised their price targets a day after it announced it would use its own chips for Mac computers.
The upbeat data on manufacturing and services sectors follows similar surveys from Europe earlier in the day as businesses reopened after the health crisis resulted in a lockdown in mid-March.
The economically-sensitive financial index .SPSY rose 1.3%, topping gains among all the 11 major S&P sub-indexes.
Global equity markets were also boosted by President Donald Trump’s assurance that the Phase 1 trade agreement with China was “fully intact”.
While tensions between Washington and Beijing this year have been a cause for concern, monetary and fiscal support worth trillions of dollars has in part powered the benchmark S&P 500 .SPX, with the index just about 7% below its Feb. 19 record high.
“There’s a lot of money on the sidelines and as the country reopens, as the economy recovers, that money will be forced back in,” said Thomas Hayes, managing member at Great Hill Capital LLC in New York.
“And then probably, we start to take a rest towards the end of the summer for a little bit before the economy truly starts to catch up to where the market is.”
At 10:09 a.m. ET, the Dow Jones Industrial Average .DJI was up 171.55 points, or 0.66%, at 26,196.51, the S&P 500 .SPX was up 22.01 points, or 0.71%, at 3,139.87. The Nasdaq Composite .IXIC was up 76.17 points, or 0.76%, at 10,132.64.
Nike Inc (NKE.N) rose 1.4% as brokerages raised their price targets ahead of quarterly results on Thursday.
Boeing Co’s (BA.N) top supplier Spirit AeroSystems Holdings (SPR.N) slipped 5.8% after it said it was seeking relief from lenders as its finances were stretched by the COVID-19 pandemic and a 737 MAX production halt.
Micron Technology Inc (MU.O) slipped 0.8% as BMO downgraded the chipmaker’s shares to “market perform”.
Advancing issues outnumbered decliners by a 3.24-to-1 ratio on the NYSE and by a 2.71-to-1 ratio on the Nasdaq.
The S&P index recorded 18 new 52-week highs and no new low, while the Nasdaq recorded 103 new highs and four new lows.
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