Wall Street reverses losing streak on renewed hopes of economic revival
NEW YORK, July 20 (Reuters) – Wall Street rebounded on Tuesday, snapping a multi-day losing streak as a string of upbeat earnings and revived economic optimism fueled a risk-on rally.
All three major U.S. stock indexes were up more than 1% with the blue-chip Dow, on the heels of its worst day in nine months, leading the charge.
The session put the S&P on track for its first advance in four days and the Nasdaq’s first gain in six.
“The markets were sold off for a number of reasons, most related to the surge in the Delta variant and concerns about the economy,” said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York.
“But now the market is roaring back,” Ghriskey added. “It shows the overall strength of the market. Even with bad news, this market shows amazing strength.”
Benchmark U.S. Treasury yields bounced back from five-month lows, in the wake of their biggest single-session decline since February in the prior session . This helped boost rate-vulnerable banks (.SPXBK) by 2.9%.
Mounting concerns over the highly contagious Delta variant of COVID-19, now responsible for the majority of new infections, have sparked sell-offs in recent sessions as worldwide vaccination efforts gather momentum. read more
For an interactive graphic on global vaccine deployment and availability, click here.
The Dow Jones Industrial Average (.DJI) rose 592.77 points, or 1.75%, to 34,554.81, the S&P 500 (.SPX) gained 69.64 points, or 1.64%, to 4,328.13 and the Nasdaq Composite (.IXIC) added 233.56 points, or 1.64%, to 14,508.54.
All 11 major sectors of the S&P 500 were in positive territory, with financials (.SPSY) enjoying the largest percentage gain.
Second-quarter reporting season has hit full-stride, with 56 of the companies in the S&P 500 having posted results. Of those, 91% have beaten consensus, according to Refinitiv.
“Earnings expectations have steadily moved higher,” said Ghriskey. “Yet companies continue to exceed those expectations, so the enthusiasm about the post-COVID economic recovery is strong, and that also helps valuations.”
Analysts now see annual S&P earnings growth of 72.9% for the April-June period, a significant improvement over the 54% growth seen at the beginning of the quarter.
Advancing issues outnumbered declining ones on the NYSE by a 4.49-to-1 ratio; on Nasdaq, a 3.38-to-1 ratio favored advancers.
The S&P 500 posted 37 new 52-week highs and no new lows; the Nasdaq Composite recorded 39 new highs and 70 new lows.Reporting by Stephen Culp; Additional reporting by Devik Jain and Shreyashi Sanyal in Bengaluru; Editing by Cynthia Osterman
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