US Stocks Rally Broadly Monday 03/01 15:57
Wall Street kicked off March with a broad rally Monday that sent the Dow
Jones Industrial Average more than 600 points higher and gave the S&P 500 its
best day in nine months.
(AP) -- Wall Street kicked off March with a broad rally Monday that sent the
Dow Jones Industrial Average more than 600 points higher and gave the S&P 500
its best day in nine months.
The S&P 500 climbed 2.4%, clawing back nearly all of its losses from last
week. More than 90% of the stocks in the benchmark index rose, with technology,
financial and industrial companies powering a big share of the S&P 500's gains.
Small company stocks also had a strong showing as they continue to outpace the
broader market this year.
The wave of buying came as investors welcomed a move lower in long-term
interest rates as U.S. bond yields declined after surging in recent weeks. The
yield on the 10-year Treasury fell to 1.43% after reaching its highest level in
more than a year last week.
Higher interest rates can slow the economy and discourage borrowing, so Wall
Street gets jittery when there's a big surge in rates.
"It moved really fast, the interest rate rise, and now it's sort of leveling
out so people are relieved that it's not continuing to move up at a really fast
pace," said Tom Martin, senior portfolio manager with Globalt Investments.
The S&P 500 rose 90.67 points to 3,901.82, it's biggest single-day gain
since June 5. The Dow gained 603.14 points, or about 2%, to 31,535.51. The
tech-heavy Nasdaq composite climbed 396.48 points, or 3%, to 13,588.83.
Smaller company stocks continued to rally, a sign that investors are feeling
more confident about the economy's prospects for growth. The Russell 2000 index
picked up 74.27 points, or 3.4%, to 2,275.32.
After a strong start to the month, stocks turned lower in the last couple of
weeks of February after a sudden, rapid rise in bond yields fueled concerns
about higher inflation. The yield on the 10-year Treasury note climbed as high
as 1.5% last week, the highest level in more than a year, before easing Friday.
Bond yields, which can influence rates on mortgages and many other kinds of
loans, have been steadily climbing this year, as investors bet that vaccination
efforts and more government stimulus will lead to strong economic growth this
year. However, along with strong economic growth comes concerns of inflation.
A handful high-level officials with the Federal Reserve will make speeches
this week, which will give investors additional information on how concerned
the nation's central bank is about the economy and inflation. Lael Brainard, an
advocate for looser monetary policies, will give a monetary policy speech on
Tuesday and Fed Chair Jerome Powell will give a speech on Thursday.
Investors also had their eye on Washington Monday as a big economic stimulus
bill advanced to the Senate. The House of Representatives approved Biden's $1.9
trillion pandemic relief bill on Friday. The bill infuses cash across the
struggling economy to individuals, businesses, schools, states and cities
battered by COVID-19.
The stimulus bill would include yet another round of one-time payments to
most Americans, including an expansion of other refundable tax credits like the
child tax credit, and additional aid to state and local governments to combat
Johnson & Johnson rose 0.5% after the Food and Drug Administration gave
approval for the company's own coronavirus vaccine, one that does not require
extensive refrigeration like the ones made by Moderna and Pfizer.
Technology and financial companies made some of the biggest gains. Apple
surged 5.4% and Citigroup rose 5.6%. Companies that rely on consumer spending
also fared well. Etsy jumped 11% and cosmetics retailer Ulta Beauty gained 4.7%.
Industrial companies, including airlines beaten down by the virus pandemic,
also helped boost the broader market. American Airlines rose 1.1%.
Investors will get several big economic reports this week, including
February's jobs report on Friday. On Monday a report on manufacturing came in
better than expectations, and new orders also came in better than expected.