By Geoffrey Smith
Investing.com -- U.S. stock markets started the week in positive mood, on revived hopes for some kind of compromise over a fresh package of economic relief measures from Washington.
Treasury Secretary Steven Mnuchin told CNBC that a deal with House Democrats is still possible this week, despite the collapse of talks last week with the two sides still over $2 trillion apart as regards the size of the measures needed. However, Mnuchin reiterated the administration's refusal to allocate $1 trillion to state and local governments to help deal with the costs of the crisis, a core demand of Speaker Nancy Pelosi's negotiating team.
By 10:20 AM ET (1420 GMT), the Dow Jones Industrial Average was up 266 points, or 1.0%, at 27,624 points. The S&P 500 was up 0.2% and the Nasdaq Composite was down 0.4%.
The Nasdaq's underperformance is likely to be brief, on recent experience. According to FactSet data, stocks that can be thought of as "Internet stocks" have outperformed the broader market by some 43 percentage points over the last 12 months, with almost all of the outperformance coming since March, as investors lurched to putting ever-higher premiums on growth and technology. Stocks without 'tech' appeal continue to struggle, although Marriott Hotels shrugged off a 3% drop in premarket to trade up fractionally after reporting a loss in the second quarter. Revenue per available room, a key metric for the group, fell 84% from a year earlier.
There was little support to the market directly from President Donald Trump's attempt to get around Congress by issuing executive orders extending unemployment benefits at a somewhat reduced level and suspending the payroll tax, measures that lawmakers on both sides of the aisle criticized as unconstitutional. Mnuchin acknowledged that there was no way around legislation as a long-term solution.
Among individual stocks, McDonald’s (NYSE:MCD) stock fell 0.8% after it announced it's suing former CEO Steve Easterbrook to claw back millions in severance pay after fresh whistle-blower allegations of sexual impropriety while at the company. Berkshire Hathaway Inc (NYSE:BRKa) stock rose 1.1% after the company provided details of its biggest-ever quarterly share buyback in the second quarter.
Eastman Kodak (NYSE:KODK) stock, which had soared after the federal government announced a $765 million loan to the company for the manufacture of drug ingredients, fell 31% after the loan was frozen pending an SEC investigation into suspected insider trading ahead of the announcement.
And the country's largest mall operator, Simon Property (NYSE:SPG), saw its stock rise 4.2% after a Wall Street Journal report at the weekend that said it's looking at converting into Amazon (NASDAQ:AMZN) fulfillment centers unused floor space formerly rented by department stores such as JC Penney (OTC:JCPNQ) and Sears.
In other markets, the dollar rebounded from a series of two-year lows, as Friday's jobs report prompted some short-covering. U.S. Crude Oil futures rose 2.2% to $42.13 a barrel, while Gold Futures regained momentum, rising 1.5% to $2,047.40 a troy ounce.