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Stocks - Dow Rallies as Energy, Financials Shine on Reopening Optimism

Published 05/20/2020, 01:19 PM
Updated 05/20/2020, 02:49 PM
© Reuters.
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By Yasin Ebrahim 

Investing.com – The Dow climbed on Wednesday as investors digested the latest earnings from corporates and ongoing efforts nationwide to reopen for business following economically-damaging lockdowns.

The Dow Jones Industrial Average rose 1.39%, or 335 points. The S&P 500 gained 1.52%, while the Nasdaq Composite added 1.67%.

Investor hopes the economy may mount a quicker recovery were given a boost on Wednesday as all U.S. States partially reopened.

That added to optimism over a rebound in crude demand, sending oil prices and energy stocks higher just as data showed weekly U.S. crude supplies fell more than expected.

Halliburton (NYSE:HAL), up 6.9%, Baker Hughes (NYSE:BKR), up 7.8%, and Marathon Petroleum (NYSE:MPC), up 7%, were among the notable movers in energy.

Financials, meanwhile, clawed back some of their losses from a day earlier, led by banks, though weaker U.S. Treasury yields kept a lid on gains.

JPMorgan Chase (NYSE:JPM), Goldman Sachs (NYSE:GS) and Citigroup (NYSE:C) rose more than 2%.

The weaker backdrop for bond yields comes on a historic day in the Treasuries market as the Treasury sold 20-year bonds for the first time since 1986 as the U.S. seeks to fund its massive stimulus program.

On the earnings front, investors continued to digest mixed reports from retailers.

Lowe’s (NYSE:LOW) cut gains to trade lower as executives warned that same-store sales growth is expected to "moderate" later in 2020. That cooled optimism on the stock after the company reported that same-store sales jumped 11% in its fiscal first quarter.

Urban Outfitters (NASDAQ:URBN) slumped 8% after its first-quarter losses swelled to $1.41 per share on revenue of $588 million, missing estimates for losses for $0.22 per share on revenue of $633.5 million.

In healthcare, Moderna (NASDAQ:MRNA) turned positive as Morgan Stanley (NYSE:MS) upgraded its price target on the stock to $90 from $37. Its shares fell 10% on Tuesday after a Stat news report suggested that recent optimism over the company's early-stage results for its potential Covid-19 vaccine was overdone.

Facebook (NASDAQ:FB) jumped 6% as investors bet its new e-commerce feature, Facebook Shops, which makes it easier for customers to sell on Instagram and Facebook, will help the social media giant compete with Amazon.com (NASDAQ:AMZN) and Alphabet (NASDAQ:GOOG).

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