US close: Stocks surge as Trump warns of 'toughest week' in virus fight

By Sharecast News

Sharecast News | 07 Apr, 2020

US stocks closed well into the green on Monday, after an overall more optimistic tone around the Covid-19 pandemic from the White House at a press conference a day earlier.

The Dow Jones Industrial Average ended the day up 7.73% at 22,679.99, the S&P 500 added 7.02% to 2,663.68, and the Nasdaq Composite was 7.33% firmer at 7,913.24.

It was a positive session throughout, with the Dow opening 934.68 points higher following a red session on Friday, after data revealed that non-farm payrolls collapsed in March, although another sharp rally in crude oil futures helped to stem losses.

Optimism about a marked slowdown in the increase of death rates and new infections in the hardest-hit countries like Italy and Spain saw indices rise on Monday, and had many investors hopeful that current restrictions could be shorter-lived than many had previously speculated.

New York state reported 594 new deaths related to Covid-19 on Sunday, fewer than the 630 reported on Saturday and marking the first daily decline.

But Donald Trump was still cautious, warning that there would be "a lot of death" in what looked set to be the US' "toughest week".

Also underlining sentiment was news that Russia and Saudi Arabia were very close to a deal on coordinated oil production cuts. However, oil prices were down after a meeting between OPEC and Russia scheduled for Monday was postponed until Thursday.

“The US indices indulged in the same hopes as their European peers on Monday, perhaps prematurely celebrating signs of coronavirus stabilisation from around the world,” said SpreadEx analyst Connor Campbell.

“The Dow Jones started big, adding 1000 points as it re-crossed 22,000.”

Campbell said it would be “interesting” if it could substantially push past that level in the next few sessions.

“For the last week or so it has been trading between 21,000 and 22,000, unable to find justification for a foray above the latter, yet not so shocked by America’s growing unemployment crisis to fall through the former.”

While no major economic data was scheduled for release on Monday, former Federal Reserve Chair Janet Yellen said the economy was in the throes of an "absolutely shocking" downturn that was not reflected yet in the current data.

If it was, she said, the unemployment rate probably would rise as high as 13%, while the overall economic contraction was about 30%.

In corporate news, Boeing shares were 19.47% higher after the firm extended the shutdown of its Seattle production operations indefinitely.

Delta Air Lines stock, meanwhile, was 0.71% weaker, after saying it expected to see revenues fall by 90% in the second quarter.

Dow Jones - Risers

Boeing Co. (BA) $148.77 19.47%
American Express Co. (AXP) $83.87 13.95%
Visa Inc. (V) $169.44 11.58%
McDonald's Corp. (MCD) $177.04 10.42%
Apple Inc. (AAPL) $262.47 8.72%
Unitedhealth Group Inc. (UNH) $248.34 8.21%
International Business Machines Corporation (CDI) (IBM) $114.82 7.97%
Intel Corp. (INTC) $58.43 7.94%
Goldman Sachs Group Inc. (GS) $158.23 7.69%
Microsoft Corp. (MSFT) $165.27 7.44%