By Yasin Ebrahim
Investing.com – The Dow started the week on the front foot on Monday, powered by tech as investors continued to favor growth stocks in the wake of the rising Covid-19 infections.
The Dow Jones Industrial Average rose 0.59%, or 151 points, the S&P 500 gained 0.66%, while the Nasdaq Composite jumped 1.11% to close at another record high.
As coronavirus infections worldwide mount, investors continued to bet that large-cap tech stocks are better placed to weather any potential disruptions to the economic reopening, and eventual recovery.
FAANG led the move higher in tech, powered by Apple (NASDAQ:AAPL) as Wall Street continued to back the tech giant. Cowen lifted its price target on Apple to $400 from $335, after raising its forecast for iPhone shipments ahead of the company's launch of a 5G iPhone later this fall.
At its worldwide developer conference, which kicked off earlier today, Apple officially announced it will move away from using Intel (NASDAQ:INTC) processors in its Mac to ARM chips -- a move which likely paves the way for the company to take "more control around its chips and architecture and crown jewels hardware ecosystem moving forward," Wedbush in a note.
The World Health Organization announced more than 183,000 new coronavirus cases on Sunday, with parts of the U.S. recording a daily record for new infections since the start of the pandemic.
Florida reported 2,926 new cases on Monday morning, taking its toll of new infections above 100,000 after governments nationwide eased public health restrictions. Other hotspots including Texas and Arizona have also put many on high alert.
"To state the obvious, Covid-19 is now spreading at an unacceptable rate in Texas," said Texas Governor Gregg Abbott, following an average of more than 3,500 new cases a day reported in the state.
The climb in tech, however, helped the broader market offset weakness in travel and tourism stocks. Airlines and cruise companies, in particular, were shunned as the rise of infections, which threatens the pace of economic reopening, raised doubt over a rebound in travel demand.
United Airlines Holdings Inc (NASDAQ:UAL) fell 0.79%, Delta Air Lines Inc (NYSE:DAL) was down 0.75%, while American Airlines Group (NASDAQ:AAL) slumped 6.75% after it announced plans to raise $3.5 billion in new financing.
TripAdvisor (NASDAQ:TRIP) clawed back losses to end flat despite warning that revenue in June will be just a fifth of revenue reported in the same period a year earlier.
Energy, meanwhile, also pushed the broader market higher, buoyed by higher oil prices as global oil producers tighten supply.
Elsewhere, Virgin Galactic Holdings Inc (NYSE:SPCE) surged 16% after it reached a deal with NASA to train astronauts for trips to the International Space Station.
On the economic front, existing home sales for May fell short of economists forecast, but analysts downplayed the data.
"The declines were broad-based, but we wouldn't make too much of this data point, which is very backward looking," Jefferies (NYSE:JEF) said. "(A)ll forward-looking indicators paint a very constructive picture for housing in the months ahead."