Stocks are climbing back after selling off to fresh lows in extended trading Sunday, as investors continue to measure the likelihood of a v-shaped bottom recovery with the uptick in coronavirus cases in a number of states, now that the country has largely reopened the economy.
After gapping down and trading about 300 points lower on Sunday, the Dow Jones Industrial Average has added 0.14% on Monday as of noon EST. Meanwhile, the S&P 500 which also sold off overnight has climbed back and is up 0.19%. The Nasdaq has climbed back the most, headed to test Friday’s highs and gained 0.55% so far.
Stock index ETFs are running higher along with the underlying benchmarks. The SPDR Dow Jones Industrial Average ETF (DIA), SPDR S&P 500 ETF Trust (SPY), and Invesco QQQ Trust (QQQ) are trading all in the green Monday.
Retails stocks like Nike, which has gained 2.1% is also helping lift the iShares Evolved U.S. Discretionary Spending ETF (IEDI) 0.22% Monday.
The benchmark U.S. stock indexes are commencing a fourth weekly gain in five weeks, with both the Dow and S&P 500 adding at least 1% last week, and the Nasdaq Composite pushing more than 3% higher despite an increase in the tally of coronavirus cases across the nation.
“The areas of concern that weighed on stocks Friday afternoon were reinforced over the weekend,” Adam Crisafulli of Vital Knowledge wrote in a note. “Governments look set to proceed with reopening, but the real driver of growth will be behavioral normalization and that is very likely to be impended by the steady negative coronavirus news flow.”
The United States released data that over 30,000 additional coronavirus cases occurred on Friday, the largest tally of confirmed one-day infections since May 1, information compiled by Johns Hopkins University showed, with states like Nevada, Florida, California and Arizona spiking in numbers and reporting record-high one-day infections, as people flocks to malls, beaches, and bars, which have all recently reopened, and led to closures of reopened stores, most notably Apple.
“There’s a war going on between the bulls and bears, with each seizing every little data point to buttress their opposing arguments,” said Vito Racanelli, market intelligence analyst at Fundstrat Global Advisors, in a note.
“I do think that perhaps the market has gone past its recovery ‘straight-up’ phase, as investors realized coronavirus (COVID-19) was not a world ender,” Racanelli said. “But the data remains mixed and Covid-19 fear remains strong, and it’s understandable.”
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