U.S. stocks opened the week strong, building on lukewarm gains from late last week.
Wall Street saw a solid day of trading Monday as governments around the world ramped up plans to reopen parts of their economies that have been restricted amid the coronavirus pandemic.
Banks, retail stores, travel companies and other businesses that stand to gain the most from people re-emerging from their homes jumped to the biggest gains.
The Dow Jones Industrial Average closed up 358.51 or 1.51% to 24,133.78.
The NASDAQ composite index ended up 95.64 or 1.11% to 8,730.16.
The S&P 500 rose 1.47% or 41.74 to 2,878.48.
Monday was the start of a week that’s packed with market-moving events.
Several major central banks are meeting, including the Bank of Japan, which announced its latest stimulus measures to prop up markets.
Bond yields rose and the price of oil fell.
All market indexes were up from the opening bell Monday as governments gradually began lifting restrictions they imposed on businesses to slow the outbreak.
What’s next
A slew of the biggest U.S. companies are also scheduled to report how much profit they made in the first three months of 2020. Bond yields rose and the price of oil fell. More importantly, they may also talk about how they see future conditions shaking out, as some investors look beyond the devastation sweeping economies now to growth potentially returning in the future.
Leaders of the U.S. Federal Reserve are likely to announce they will wait to see the impact of earlier stimulus before taking more action, Hayaki Narita of Mizuho Bank said in a report. The European Central Bank “will likely keep its options for easing open.”
President Donald Trump, campaigning for re-election, is pressing U.S. state governors to ease anti-disease controls as early as possible.
Some states are lifting shutdown orders despite warnings that could cause a surge in infections. Others including Gov. Andrew Cuomo of New York say they want a bigger decline in new cases before rolling back curbs.
This week’s other potentially market-moving events include data from the United States, China, Japan, Germany and France on inflation, trade, unemployment, industrial activity and retail spending.
Previously
On Friday, Trump signed legislation to provide an additional $500 billion in virus aid, including loans to small businesses. Government data showed an unexpectedly sharp 14.4% drop in U.S. durable goods orders.
“Investors have written off 2020 as a shocker and are looking more intently into the landscape in 2021,” said Chris Weston of Pepperstone in a report.
They are due to get more indicators how that future might develop when companies including Exxon, Amazon, Microsoft, Boeing, Airbus, Volkswagen and McDonald’s start reporting quarterly results this week.
Around the world
Global stocks rose Monday after Japan’s central bank boosted support for financial markets and more governments prepared to reopen economies that were shut down to fight the coronavirus pandemic.
Tokyo’s benchmark surged 2.7% and European markets traded higher, while Wall Street futures pointed to gains on the open in the U.S.
Investors are looking ahead to meetings of U.S. and European central bankers this week for additional measures to reverse the deepest global slump since the 1930s. Evidence is mounting that the damage is worse than expected.
The Bank of Japan said it will inject money into the financial system by purchasing an additional 15 trillion yen ($140 billion) of commercial paper and bank loans. The bank also scrapped its ceiling on purchases of government debt.
Investors appear to be looking past the outbreak to figure out which companies can survive and prosper after conditions improve.
China, where the pandemic began in December, has reopened factories and other businesses after numbers of new cases declined. Spain plans to start easing restrictions Sunday and Italy on May 4. France will announce its plans next month.
Hopes for a return to normal “should see markets such as equities outperform this week," said Jeffrey Halley of Oanda in a report.
In London, the FTSE 100 opened up 1.5% at 5,839 and Germany's DAX gained 2.5% to 10,589. The CAC 40 in France added 1.9% to 4,477.
In Asia, the Shanghai Composite Index gained 0.3% to 2,815.49 while the Nikkei 225 in Tokyo rose to 19,783.22. The Hang Seng in Hong Kong added 1.9% to 24,280.14.
In Seoul, the Kospi was 1.8% to 1,922.77. Sydney’s S&P-ASX 200 gained 1.5% to 5,321.40 and India’s Sensex advanced 1.4% to 31,786.49. Singapore advanced 1.4% and Bangkok gained 0.3%.
Also Monday, China’s government reported profits at major industrial companies fell 34.9% in March from a year earlier. That was an improvement over the 38.3% decline in January and February, but analysts said a full recovery is a long way off.
In energy markets, benchmark U.S. crude for June delivery lost $2.78 cents to $14.16 per barrel in electronic trading on the New York Mercantile Exchange. Brent crude, used to price international oils, declined $1 to $23.81 per barrel in London.
One casualty of the plunge in oil prices, Houston, Texas-based contract driller Diamond Offshore Drilling Inc., filed for bankruptcy Sunday with debts of $2.6 billion. It said conditions had deteriorated sharply with the pandemic and the recent price war between Russia and other producers.
Like many U.S. oil producers, Diamond Offshore is at a competitive disadvantage when oil prices decline, in its case because of the relatively high cost of pumping oil from deepwater drilling platforms.
The dollar declined to 107.15 yen from Friday’s 107.49 yen. The euro gained to $1.0842 from $1.0823.
— Compiled from The Associated Press.
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