US close: Stocks stage turnaround despite growing number of new Covid-19 cases
Wall Street stocks closed higher on Monday despite market participants struggling with signs of a second wave of Covid-19 cases as the US economy emerges from lockdown.
At the close, the Dow Jones Industrial Average was up 0.62% at 25,763.16, while the S&P 500 was 0.83% firmer at 3,066.59 and the Nasdaq Composite saw out the session 1.43% stronger at 9,726.02.
The Dow closed 157.62 points lower on Monday, carrying on from Friday's solid gains that came as stocks bounced back from sharp losses a day earlier.
At the bell, shares tied to the reopening of the economy such as Carnival, Royal Caribbean, American Airlines and United Airlines were all down at least 4.5%, while Kohl's and Gap also traded lower, as the likes of Alabama, California, Florida, Texas and North Carolina all reported a rise in new coronavirus-related hospitalisations.
Weaker than expected retail and industrial production data out of China and news of a spate of new Covid-19 cases in a major wholesale food market in Beijing was also weighing on sentiment.
However, an announcement from the Federal Reserve that it would look to purchase individual corporate bonds gave sentiment a boost later in the session.
On the macro front, manufacturing sector activity in the New York state area stabilised unexpectedly in June as the Federal Reserve Bank of New York's regional manufacturing gauge bounded back 48.5 points from the prior month's sharp fall to -0.2.
That was significantly ahead of the median forecast from economists for an improvement to -28.5 and pointed to upside risk for the Philly Fed index due out on Thursday, said Ian Shepherdson, chief economist at Pantheon Macroeconomics.
In Fed talk, Dallas Fed President Robert Kaplan said he was sceptical of the central banking using so-called "yield-curve control" as a new tool to help the US economy bounce back from the coronavirus-fuelled recession, while San Francisco Federal Reserve President Mary Daly called on policymakers to boost spending on healthcare, education and digital infrastructure, even as she signalled that she anticipates the US central bank to keep interest rates low and do more if needed be.
No major corporate earnings were released on Monday.