By Liz Moyer
Investing.com -- Investors cling to the "accentuate the positive" mantra despite an ongoing viral pandemic that has caused havoc in global economies.
On Monday, positive news – however incremental – on possible treatments for Covid-19 sent stocks soaring to new records for the S&P 500 and NASDAQ Compositeand lifted the Dow Jones Industrial Average more than 378 points. Apple Inc (NASDAQ:AAPL) reached above $500 for the first time with just days to go until its four-to-one stock split.
Pharmaceutical makers rose after the Food and Drug Administration granted emergency authorization for therapeutic plasma as a treatment for patients hospitalized with Covid and after the government suggested it may fast-track AstraZeneca PLC ADR (NYSE:AZN)'s coronavirus vaccine.
Even beaten down airline stocks got a boost after the Environmental Protection Agency green-lighted the use of an antiviral spray. American Airlines Group (NASDAQ:AAL) jumped 10% after saying it would use the spray in its passenger cabins.
Retailers feature in the tail-end of earnings season, while energy stocks are in the spotlight as two storms head toward the U.S. Gulf Coast.
Here are three things that could affect the markets tomorrow:
1. Best Buy one of the retail winners
Electronics retailer Best Buy Co Inc (NYSE:BBY) has been among the winners in the sector as stay-at-home orders created demand for laptops and other gadgets for learning and working. The company is expected to report earnings per share of 99 cents on revenue of $9.6 billion, according to analysts tracked by Investing.com. That would be an increase from 67 cents per share the previous quarter.
The stock is already up 33% this year and hit another record on Monday, trading at $119.48. Raymond James raised its price target to $135, highlighting its strong fulfillment capabilities and ability to gain market share.
2. Nordstrom an example of the other side of the retail sector
Expectations are already low for department store Nordstrom Inc (NYSE:JWN) heading into its earnings report on Tuesday, with analysts estimating a per-share loss of 1.50 on revenue of $2.4 billion.
Sales were better than expected when it reported its previous quarter in May, but the longer-term trend has seen shoppers turning away from traditional stores like Nordstrom and Macy’s Inc (NYSE:M) in favor of Target Corporation (NYSE:TGT) and other chains and, of course, Amazon.com Inc (NASDAQ:AMZN). Shares of Nordstrom are down 62% this year, though they traded up 7% on Monday.
Last week Target and fellow big-box retailer Walmart Inc (NYSE:WMT) reported big gains in revenue, further cementing the line between the sector's haves and have nots.
Also due out on Tuesday are earnings from Urban Outfitters Inc (NASDAQ:URBN) and Children's Place.
3. Energy sector in focus as storms barrel toward Gulf Coast
A basement-dweller among S&P sectors for years, energy got a brief chance to shine on Monday as the top performer of the 11 in the index, rising 2.5%. The main driver appears to be two storms headed to the Gulf Coast region, where much of the U.S.'s energy businesses operate.
Tropical Storm Marco isn't expected to be as intense as the storm that is expected to become Hurricane Laura by landfall later this week, but it's unusual for two storms to hit within days of each other and basically along the same route. Oil and chemical facilities in the area are shutting down ahead of the storms. Bloomberg reported it could reduce capacity in the oil sector by 1 million barrels a day.
Of course less capacity means oil prices rise, even in the wake of questionable demand. Crude Oil WTI Futures, the U.S. benchmark, rose 0.14% on Monday as of 3:41 PM ET, at around $42.40, while Brent Oil Futures crude, the international standard, rose 1.34%, at $45.53.