82.44 F
New York
August 5, 2020
Home » Blog » The Dow is set to open 400 points higher as Wall Street builds on last week’s gains, airlines rise
CNBC Business

The Dow is set to open 400 points higher as Wall Street builds on last week’s gains, airlines rise

The Dow is set to open 400 points higher as Wall Street builds on last week's gains, airlines rise
Spread the Love!

CNBC – For more and to sign up click here

U.S. stock futures traded sharply higher early Monday as Wall Street tried to build on the momentum from last week’s solid performance and shake off a continued rise in coronavirus cases.

Dow Jones Industrial Average futures rose 377 points, or 1.5%. The move implied an opening gain of more than 433 points. S&P 500 futures gained 1.2%. Nasdaq-100 futures gained 1.2%.

There were a few reasons for the bullish lift to start the week:

  • Stocks closely tied to an economic reopening gained in premarket trading Monday. Carnival Corp, Royal Caribbean and Norwegian Cruise Line all jumped more than 3%. American Airlines and Delta Air Lines also gained more than 3%. Shares of retailer Gap were higher as well.
  • Dealmaking also boosted sentiment. Warren Buffett made his first major deal amid the market turmoil this year, with Berkshire Hathaway buying the natural gas transmission and storage assets from Dominion Energy for about $10 billion including debt. Dominion Energy added 5% in premarket trading. Uber shares gained after reportedly agreeing to an all-stock deal for food-delivery app Postmates.
  • Chinese stocks soared, with the Shanghai Composite jumping more than 5%, as that country continued to open up following their coronavirus outbreak.
  • Stocks were building on momentum to start the second half. The Dow and S&P 500 rose 3.3% and 4%, respectively, last week and the Nasdaq advanced 4.6% in that time.The market also wrapped up last week its best quarterly performance in decades. The Dow rallied more than 17% for the second quarter while the S&P 500 jumped nearly 20% in that time period. The Nasdaq posted a gain of 30.6% for the quarter.

“The economy is doing a lot better than most of the economists think,” said Jeff Saut, chief investment strategist at Capital Wealth Planning, to CNBC’s “Squawk Box” on Monday. “We may stall here for a while into the fall, into September, October, November, but I think you’re going to get a rocket ship coming in the fall of this year…I think the S&P 500 is going to trade above 4,000.”

Sunday’s gains we’re kept in check, however, as the number of coronavirus cases kept surging globally, raising concerns about the world economy and its recovery from the pandemic.

The World Health Organization said Saturday that more than 200,000 coronavirus cases were confirmed over a 24-hour span, a record. At a regional level, the biggest spike was seen in the Americas, where nearly 130,000 new cases were confirmed.

In the U.S., Florida and Texas reported daily record spikes of 11,445 and 8,258, respectively, on Saturday. Houston Mayor Sylvester Turner said the outbreak is on pace to overwhelm the city’s hospitals in two weeks. Miami Mayor Francis Suarez told ABC this weekend: “It’s clear that the growth is exponential at this point.”

Data compiled by Johns Hopkins University showed that more than 45,000 new cases were confirmed across the U.S. on Saturday.

“We are currently experiencing a spike in Covid-19 cases, particularly in the sunbelt states that were in the vanguard of loosening social distancing restrictions to facilitate the reopening of their economies,” said Marc Chaikin, CEO of Chaikin Analytics, in a post.

“That reopening momentum has been halted by the spike in Covid-19 cases and the temptation to translate this into a bearish outlook for stocks is strong,” he added. “Fatalities have not spiked, however, but are a lagging indicator. Thus the next two weeks are critical for a number of reasons.”

Subscribe to CNBC PRO for exclusive insights and analysis, and live business day programming from around the world.

Source – Click here for more

To Return to the Main Aggregate News Page – click here

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Click whichever is suitable. Accept Read More