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Stock - Wall Street Opens Higher as Cyclicals' Recovery Gains Strength

Stock MarketsMay 27, 2020 09:39AM ET
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© Reuters.

By Geoffrey Smith 

Investing.com -- U.S. stock  markets opened mostly higher again on Wednesday, with cyclicals and old-economy stocks leading the charge, recovering some of their underperformance vis-a-vis tech stocks and defensives over the last couple of months. 

By 9:37 AM ET (1337 GMT), the Dow Jones Industrial Average was up 340 points or 1.4% at 25,335 points, while the S&P 500 was up 0.8%, while the extent of the rotation out of tech stocks was illustrated by the Nasdaq Composite falling 0.2%.

Some of the biggest gainers were old-economy industrials and banks, the latter in particular having been spooked recently by fears that the Federal Reserve will resort to sub-zero interest rates next year. The notion of a quick and robust rebound, already strengthened by TV footage of a Memorial Day weekend where 'animal spirits' appeared generally unleashed, received further support from a clear rebound in the Richmond Federal Reserve's monthly business survey: the manufacturing index rebounded to -27 from -53, while the services index recovered to -48 from -87.

The Dallas Fed's monthly survey is due later, as is the Fed's Beige Book roundup.

JPMorgan  (NYSE:JPM) and Bank of America (NYSE:BAC) stock both rebounded 3.8%, while General Electric (NYSE:GE) stock rose 6.3%, as participants took a slightly less bearish view on the outlook for its troubled aviation unit.

At the other end of the table, money flooded out of those stocks which had seemed the best refuge during the worst of the pandemic's effects. Amazon.com  (NASDAQ:AMZN) stock fell 2.2%, while Zoom Video (NASDAQ:ZM) fell 6.0%. Shopify  (NYSE:SHOP) stock and Beyond Meat (NASDAQ:BYND) stock both fell 7.4%. 

Moderna  (NASDAQ:MRNA) stock also fell sharply for a second day after another filing showing that the biotech company's insiders sold stock in the wake of the company's $1.3 billion capital increase last week. The company has drawn criticism for issuing partial test results for its experimental Covid-19 antiviral drug, which propelled the stock to an all-time high just before the share sale. The stock 11.6% and is now down nearly one-third from the placement price.

In other markets, U.S. Crude Oil futures cooled off after their recent rally ahead of American Petroleum Institute inventory data at 4:30 PM ET. WTI was down 2.7% at $33.43 a barrel. Gold Futures, meanwhile, fell 0.5% to a three-week low while the US Dollar Index Futures was roughly unchanged.

Stock - Wall Street Opens Higher as Cyclicals' Recovery Gains Strength
 

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Comments (9)
Bulls MakeMore
Bulls MakeMore May 27, 2020 10:58AM ET
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buying opportunity today
Kaveh Sun
Kaveh Sun May 27, 2020 10:36AM ET
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It opens up because Asian session pushes it up and vice versa.
Bulls MakeMore
Bulls MakeMore May 27, 2020 10:36AM ET
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...and they are both up because economies worldwide are reopening, and no major setbacks thus far
Mike Wash
Mike Wash May 27, 2020 10:29AM ET
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Thanks for the heads up to short LOL
Bulls MakeMore
Bulls MakeMore May 27, 2020 10:29AM ET
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hope you don't mind losing money
Mike Wash
Mike Wash May 27, 2020 10:29AM ET
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Bulls MakeMore Lol did you not see the Nazdaq bud I made money, not only that if you new anything you would know that the Nazdaq has broken out today to the down side, so dry your eyes and go try to learn something about trading before you end up losing people money.
Mike Wash
Mike Wash May 27, 2020 10:29AM ET
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People do not listen to this person anyone saying there is only one direction all the time is obviously wrong.
Yi Li
Yi Li May 27, 2020 9:53AM ET
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Sike!
Habanero Peppers
Habanero Peppers May 27, 2020 9:52AM ET
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Article Summary: Stonks
John Kahare
John Kahare May 27, 2020 9:51AM ET
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I ok on
Kishor Pawar
Kishor Pawar May 27, 2020 9:50AM ET
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From trader I became fund manager... Thanks to Sumit and Puneet Sheth....
Pwr Strk
Pwr Strk May 27, 2020 9:49AM ET
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as soon as you posted this, they all fell
Matt Kay
Matt Kay May 27, 2020 9:49AM ET
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Post some more! Ee need spoos at least hundred points lower
Fernando Campos
Fernando Campos May 27, 2020 9:45AM ET
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It does make any sense!!!
 
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