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Wall Street posts record closing highs as financials lead rebound

Stock MarketsJul 09, 2021 06:52PM ET
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© Reuters. FILE PHOTO: People are seen on Wall Street outside the New York Stock Exchange (NYSE) in New York City, U.S., March 19, 2021. REUTERS/Brendan McDermid

By Caroline Valetkevitch

NEW YORK (Reuters) - The three major U.S. stock indexes rallied to record closing highs on Friday as financials and other economically focused sectors rebounded from a selloff sparked by growth worries earlier in the week.

The rally allowed the indexes to notch slight gains for the week, which also saw a sharp rally in U.S. Treasuries as investors worried the U.S. economic recovery might be losing steam as the Delta variant of the coronavirus spread globally.

U.S. 10-year Treasury notes fell on Friday, halting an eight-day price rise, while the S&P 500 financials sector jumped 2.9% in the sector's biggest daily percentage gain since March 1.

Financials led sector advances followed by energy, materials and industrials. Big banks including JPMorgan Chase & Co (NYSE:JPM) will kick off the second-quarter earnings season next week when they report results.

"What an about-face from all of the gloom and doom from yesterday," said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma.

"The U.S. is in a bubble compared to the rest of the world, in a break from COVID. How long that's going to last we don't know," he said, but "until that narrative changes, this is a market with a lot of free money and low interest rates."

The Dow Jones Industrial Average rose 448.23 points, or 1.3%, to 34,870.16, the S&P 500 gained 48.73 points, or 1.13%, to 4,369.55 and the Nasdaq Composite added 142.13 points, or 0.98%, to 14,701.92.

For the week, the Dow is up 0.2%, and the S&P 500 and Nasdaq each added 0.4%.

A big jump in quarterly earnings is expected to mark a peak for U.S. profit growth in the recovery from last year's pandemic-induced collapse. Investors are looking to U.S. companies' upcoming quarterly results and forecasts about the recovery in the second half of 2021 as some worry that the recent economic surge is already waning.

Analysts expect earnings growth of 65.8% for companies in the S&P 500 index in the quarter, up from a previous forecast of 54% growth at the start of the period, according to Refinitiv IBES data.

(Graphic: Q2 expected to see peak results for U.S. companies, https://graphics.reuters.com/USA-STOCKS/EARNINGS/jbyprzbqype/chart.png)

Among individual stocks, Levi Strauss & Co (NYSE:LEVI) rose 1.4% as it forecast a strong full-year profit after beating quarterly earnings estimates on improving demand across its markets for jeans, tops, and jackets.

U.S.-listed shares of Chinese ride-hailing company Didi Global Inc gained 7.3% after four sessions of losses, as it was recently hit by an investigation from China's internet watchdog.

Volume on U.S. exchanges was 8.51 billion shares, compared with the 10.5 billion average for the full session over the last 20 trading days.

Advancing issues outnumbered declining ones on the NYSE by a 3.77-to-1 ratio; on Nasdaq, a 3.33-to-1 ratio favored advancers.

The S&P 500 posted 44 new 52-week highs and no new lows; the Nasdaq Composite recorded 60 new highs and 32 new lows.

Wall Street posts record closing highs as financials lead rebound
 

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Comments (2)
Belal Abusaad
Belal Abusaad Jul 12, 2021 12:34AM ET
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nice report
Sarah Maleka
Sarah Maleka Jul 09, 2021 5:04PM ET
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Have to be alert at all times in this market
 
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