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Wall Street gets PayPal boost as Nasdaq erases 2020 declines

Published 05/07/2020, 06:59 AM
Updated 05/07/2020, 02:50 PM
© Reuters. The spread of the coronavirus disease (COVID-19) in New York

By Lewis Krauskopf

(Reuters) - Wall Street's indexes jumped on Thursday, with the Nasdaq turning positive for the year, following a clutch of upbeat earnings reports led by PayPal as investors looked past more weak jobs data caused by the coronavirus-induced economic downturn.

All 11 S&P 500 sectors moved higher, led by energy (SPNY), materials (SPLRCM) and financials (SPSY) which have lagged this year.

Shares of PayPal Holdings (O:PYPL) soared 13.9% and boosted the S&P 500 and the Nasdaq after the company said it expects a strong recovery in payments volumes in the second quarter as social distancing drives more people to shop online.

Shares of media company ViacomCBS Inc (O:VIAC) and ride-hailing firm Lyft (O:LYFT) also jumped after their earnings, as a first-quarter reporting season that Refinitiv estimates will show a 12% decline in earnings begins to wind down. ViacomCBS shares rose 10.7% and Lyft shares climbed 22.0%.

Stocks have rebounded sharply since late March from the coronavirus-fueled sell-off, helped by massive monetary and fiscal stimulus. Investors are now watching efforts by a number of states to spark their economies by easing restrictions put in place to fight the outbreak.

“You are seeing incrementally some parts of the global economy opening up again plus slightly better earnings," said Eric Freedman, chief investment officer at U.S. Bank Wealth Management.

The Dow Jones Industrial Average (DJI) rose 294.12 points, or 1.24%, to 23,958.76, the S&P 500 (SPX) gained 40.43 points, or 1.42%, to 2,888.85 and the Nasdaq Composite (IXIC) added 132.69 points, or 1.5%, to 8,987.08.

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The Nasdaq turned positive for 2020 during the session, after being down well over 20% for the year as of late March.

Data showed millions more Americans sought unemployment benefits last week, suggesting layoffs broadened from consumer-facing industries to other segments of the economy and could remain elevated even as many parts of the country start to reopen.

The U.S. employment report for April is due on Friday.

“The market rightly or wrongly is just much more focused on what that data looks like two months from now, not what that data looks like right now,” Freedman said.

Investors were also encouraged by news that China's exports unexpectedly rose in April for the first time this year as factories raced to make up for lost sales due to the coronavirus pandemic.

The development of treatments for the coronavirus has been watched closely by Wall Street as key for resuming economic activity. Moderna Inc (O:MRNA) shares rose 10.1% after the company sped up plans for its experimental COVID-19 vaccine and said it expected to start a late-stage trial in early summer.

Advancing issues outnumbered declining ones on the NYSE by a 3.72-to-1 ratio; on Nasdaq, a 2.68-to-1 ratio favored advancers.

The S&P 500 posted nine new 52-week highs and no new lows; the Nasdaq Composite recorded 53 new highs and seven new lows.

Latest comments

People buying stocks as 2021 recovery expected, this year is a write-off as economies were purposely shut down to counter virus, and earnings reports have not been as bad as feared....but people are also buying gold as a hedge....what's so hard to understand?
Please, it doesnt matter the reasons it was shut down! The fact of the matter is businesses will go bankrupt and alot of jobs will not come back! You are dillusional if you think this will not have lasting impact. What you fail to understand is that we were heading towards a small recession anyway and with the unlimited printing of money there will be a econimic effect for years! When warren buffett is concernd you should be to!
Lol, what if you were buying a company and the company owner was asking for a price lile it waa Feb 1st? If you asked for a discount because of the conditions and his response was 2020 is a write off and in 2021 it will be like nothing happened! Lol! Write off? Lol? Are we sure 2021 will be like nothing happened? Perhaps? Perhaps not. The truth is there is uncertainty as to what the economy will be and you dont get to just write off a year. The current discount doesnt reflect the current risk imo!
China data,LOL
why financial journalism and the markets are complete jokes, top two headlines today: "Gold Rises as Jobless Claims Revive Concerns for Economic Outlook", "Wall St jumps as PayPal outlook, China data fuel recovery hopes"
Exactly. The headlines on this website are atrocious. These people think they can get into the minds of traders and investors and tell you the exact reason why a certain sector or market is moving in a particular way. It's my single biggest gripe here. Just report on the news, no need to link price movements with news at all times, especially in times of volatility which often renders the headline false on the same day.
People buying stocks as 2021 recovery expected, this year is a write-off as economies shut down purposely to counter spread of virus, and earnings reports have not been as bad as expected...gold also being bought as a hedge...what's so hard to understand?
E-commerce WOOWWWW! Pay Pal UAAAUUUU! fake china data YEAHHHH!, 45 MILIONS unemployed is irrelevant!
since China is doing so good, they should pay $1 million dollars per death they caused around the world with the chinese virus
a $275 billion fine to China is actually cheap for the damage China has caused to humanity and the world economy ... the main point here is that China should be penalized for what they've done (and continue to do)
The same could be said when the US blew up the world's economy in 2008. Blew up Iraq for fake WMDs, blew up Afghanistan for an anticlimactic war. Add that all up, you'd probably have to auction off a few States to compensate
 No, the USA should just withdraw all investments from China, including intellectual property. That should take care of this little problem.
paypal will save the world economy. Webmoney will assist.
15% is a huge decline for the S&P!!!
pessimists here keep piling up and the market keeps going up . the stock market is NOT about the economy anymore
It's all about printed money and the Central Banks and Federal Reserve buying up everything.
vessel calls have dropped by the hundreds on the west coast since January, vessels that normally had thousands of TEUs in port are now in the hundreds. These numbers are an outright fabrication. There has been an uptick in the last 2 weeks only.
The market is just like Servepro "like it never even happened ".
Down in the first two weeks of April, most shipping companies docked ships for the forseeable future, all their customers locked down, and yet somehow they have an increase in exports? Something smells fishy. https://www.scmp.com/economy/china-economy/article/3080041/coronavirus-container-traffic-chinas-top-eight-ports-plunges
Taking export number from China. Most of China sales were low quality masks.
We're believing that China's exports are up YoY?
Well not sure about exports. But the Imports should be through the roof seeing as they hoarded the worlds medical equipment druing Q1.
Asia will be number 1 by end of the virus due to usa’s poor response to the pandemic . Taiwan , Hong Kong , Vietnam all doing well and open for business. All of china is open as well . People are shopping and disney is reopening . This marks start of a paradigm shift for asia dominance .
bimbo
go go bulls and Asia!
Since when the US believes in Chinese's data? And since when China became so important to the US?
"....since when China became so important to the US?"  -- I bet you wrote this with a chinese made laptop/tablet/phone.....
 i am sure the guy was being sarcastic lol.
US needs trade from China I suppose
lol mayby the china get bigger export by the highter us dollar.
thought China’s figures can’t be trusted? Lol
Only Investing/Reuters/NYSE believe that or sell the fake news
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