Bank, oil stocks lead Dow higher by 500 pts, sees best day since mid-May

The S&P 500 and the Dow rebounded on Monday with financials and…



The S&P 500 and the Dow rebounded on Monday with financials and energy shares rising, as investors piled back into stocks that are set to benefit from a broader economic recovery.


All of the 11 S&P sectors advanced in early trading, with energy, financials, industrials and materials jumping more than 1.5% each.





The Dow Jones Transports Average, considered a barometer of economic health, jumped 1.4%, while the small-cap Russell 2000 added 1.1%.


The broader banking index rose 1.6% after crashing to a two-month low last week.


The Dow and the S&P 500 last week suffered their worst weekly performance in months after the Federal Reserve penciled in two interest rate increases in 2023, sooner than anticipated.


The S&P 500 has traded in a tight range this month as investors juggled fears of an overheating economy with optimism about a strong economic rebound.


“I’m not a believer this inflation story is over anytime soon and raising rates may come sooner than 2023,” said Drew Horter, chief investment officer of Tactical Fund Advisors, in Cincinnati, Ohio.


“There’s going to be churning, there’s going to be consolidation. The market is historically at very frothy valuations as we head into lower volume months of the summer.” Investors this week will focus on U.S. factory activity surveys, home sales data and remarks from several Fed officials, including Chair Jerome Powell, who testifies before Congress on Tuesday.


At 10:40 a.m. ET, the Dow Jones Industrial Average was up 499.95 points, or 1.5%, at 33,790, and was seeing its best day since mid-May.


The S&P 500 was up 47.78 points, or 1.15%, at 4,214.72, and the Nasdaq Composite was up 68.26 points, or 0.49%, at 14,098.58.


Value stocks, which include banks, energy and other economically sensitive sectors and have led gains in U.S.


equities so far this year, outperformed their growth-oriented technology counterparts on Monday.


The trend was a stark reversal from last week when the Fed’s hawkish signals on monetary policy sparked a round of profit taking that wiped out value stocks’ lead over growth this month.


The S&P 500 value index is now down about 3% in June, compared with a 2% rise in the tech-heavy growth index.


Crypto stocks including miners Riot Blockchain, Marathon Patent Group and crypto exchange Coinbase Global dropped between 1.9% and 3.3% on China’s expanding crackdown on bitcoin mining.


L Brands Inc rose 2.8% after the company filed for the spin-off of its Victoria’s Secret business.


Moderna Inc gained about 4% after a report said the drugmaker is adding two new production lines at a COVID-19 vaccine manufacturing plant, in a bid to prepare for making more booster shots.


Market participants are also girding for probably the biggest trading event of the year this Friday, as the FTSE Russell rebalance its indexes that will reflect a wild trading year marked by the pandemic and the “meme” stock craze.


Advancing issues outnumbered decliners by a 2.70-to-1 ratio on the NYSE and by a 1.36-to-1 ratio on the Nasdaq.


The S&P index recorded six new 52-week highs and no new low, while the Nasdaq recorded 23 new highs and 28 new lows.

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