Monday’s Stock Market Close: US Equities Jump On Economy Reopening, Nasdaq Hits Record Closing High

U.S. stocks climbed higher on Monday, with the Nasdaq setting a new closing high, adding to Friday’s gains spurred by a surprising jobs report that buoyed traders’ hopes for a quicker recovery from the covid-19 pandemic. The S&P 500 has erased its losses for the year, having surged 44% since March lows.

The Dow Jones Industrial Average jumped 461.46 points to 27,572.44, while the S&P 500 gained 38.46 points to 3,232.39 and the Nasdaq Composite Index climbed 110.66 points to 9,924.74.

Nasdaq’s previous closing high was 9,817.18 set on Feb. 19.

Monday’s volume on the New York Stock Exchange totaled 7.46 billion shares with 2,389 issues advancing, 55 setting new highs, and 594 declining, with four stocks setting new lows .

Active movers were led by Hertz Global Holdings Inc. (HTZ), American Airlines (AAL) and General Electric Co. (GE).

“What is clearly happening is the excitement of reopening is allowing a lot of these companies that have been casualties of Covid to come back and come back in force,” said Stanley Druckenmiller, chairman and CEO of the Duquesne Family Office. “Well I’ve been humbled many times in my career, and I’m sure I’ll be many times in the future. And the last three weeks certainly fits that category.”

Over the weekend, the Organization of the Petroleum Exporting Countries and its allies agreed to extend their output cuts through July.

On Friday, traders were pleasantly surprised after the U.S. Labor Department said some 2.5 million jobs were created in May.

“The 2.5 million rebound in employment last month reverses only a small fraction of the jobs lost since February,” said Michael Pearce, senior U.S. economist at Capital Economics. “But considering we and the consensus had been braced for another large decline, it builds on the signs from some of the other macro data this week that economic activity is rebounding faster and more vigorously than we had anticipated.”

Meanwhile, the number of covid-19 cases worldwide has surpassed 7 million, while the number global deaths exceeded 403,000.

German industrial production plunged by 17.9% in April – an all-time record -- from the prior month -- following an 8.9% decline in March.

In the U.S., more analysts have become hopeful.

“The stock market is almost looking past Covid and looking forward to the reopening,” said Ryan Detrick, senior market strategist at LPL Financial. “The concerns of another Covid outbreak are real, but the stock market is clearly saying it is much more in tune with the opening of the economy.”

But Detrick cautioned that “the market is ripe for a well-deserved break” after this rally.

“It appears that the most rapid bear market in history has been followed by the most dramatic recovery in history,” said Marc Chaikin, CEO of Chaikin Analytics. “While COVID-19 cases are still growing in certain states, particularly outside of densely populated urban areas, investors see the glass as half-full and are looking ahead 12-18 months.”

Overnight in Asia, markets finished higher. The Shanghai Composite rose 0.24%; Hong Kong’s Hang Seng edged up 0.03%; while Japan’s Nikkei-225 gained 1.37%.

In Europe markets finished lower, as Britain’s FTSE-100 slipped 0.18%, while France’s CAC-40 fell 0.43% and Germany’s DAX fell 0.22%.

Crude oil futures dropped 3.46% at $38.18 per barrel, Brent crude edged up 0.07% at $40.83. Gold futures gained 1.28%.

The euro edged up 0.04% at $1.1295 while the pound sterling rose 0.49% at $1.273.

The yield on the 10-year Treasury dropped 2.21% to 0.884% while yield on the 30-year Treasury fell 1.07% to 1.66%.