Wall Street closed higher on Thursday buoyed by investors' optimism on reopening the U.S. economy after a month and half long partial lockdown. All three major stock indexes ended in the green. Growth sectors like energy, financials and materials contributed the most to the day's rally. Meanwhile, the Nasdaq Composite erased losses for 2020 and now in positive territory year to date.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) gained 0.9% or 211.25 points to close at 23,875.89. Notably, 17 components of the 30-stock blue-chip index ended in green while 13 finished in the red. Meanwhile, the S&P 500 surged 1.2% to close at 2,881.19. The Energy Select Sector SPDR (XLE), the Materials Select Sector SPDR (XLB) and Financials Select Sector SPDR (XLF) gained 2.6%, 2.1% and 2.4%, respectively. Notably, 9 of the eleven sectors of the benchmark index closed in the green while 2 finished in red.
The tech-heavy Nasdaq Composite closed at 8,979.66, advancing 1.4% due to the strong performance of large-cap tech stocks. This was the fourth straight winning streak for the index.
The fear-gauge CBOE Volatility Index (VIX) decreased 7.9% to close at 31.44. A total of 10.4 billion shares were traded on Thursday, lower than the last 20-session average of 11.7 billion. Advancers outnumbered decliners on the NYSE by a 2.96-to-1 ratio. On Nasdaq, a 2.33-to-1 ratio favored advancing issues.
Nasdaq Turns Green Year to Date
The Nasdaq Composite started rallying since the beginning of 2020 after finishing an impressive 2019 rallying 35.2%. Since then, the index had a dream run attaining fresh highs almost every day. On Feb 19, the tech-laden index reached its all-time high of 9,838.37 after which its took a backward bend on the verge of the coronavirus outbreak.
The index entered into negative territory year-to-date on Feb 25 and finally had fallen in bear-market (characterized as decline of 20% or more from recent high) On Mar 12. The down trend continued since Mar 23.
However, since Mar 24, the Nasdaq Composite started moving upward along with both the Dow and the S&P 500. On Apr 14, it finally exited the bear-market territory. Since Mar 24, the index has rallied a fabulous 30.9% so far. Despite this bull run, Nasdaq Composite is still 9.6% away from its all-time high recorded on Feb 19.
Bank Stocks Gain
Major banks have rallied as the spread between the 2-Year and 10-Year US Treasury Notes widened. Notably, the wider spread between longer-term assets, such as loans, with shorter-term liabilities, will boost bank's profits. Consequently, shares of Citigroup Inc. (C - Free Report) , The Goldman Sachs Group Inc. (GS - Free Report) and Morgan Stanley (MS - Free Report) rallied 3.9%, 3.1% and 4.1%, respectively. Citigroup has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Department of Labor reported that 3.169 million applied for unemployment benefit for the week ended May 2. The figure surpassed the consensus estimate of 3.002 million but lower than the previous week's revised data of 3.846 million. With this, initial jobless claims exceed 33 million in the past seven weeks. However, last week's data was half of the 6.9 million claims applied in the last week of March.
Stocks That Made Headline
Uber's Q1 Loss Narrower Than Estimated, Stock Up
Uber Technologies, Inc. (UBER - Free Report) incurred a loss of $0.64 per share (excluding $1.06 from non-recurring items) in the first quarter of 2020, narrower than the Zacks Consensus Estimate of a loss of $0.79. (Read More)
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