Stocks Rise on Monday 12/06 16:05
Stocks rose broadly on Wall Street Monday, nearly reversing the S&P 500's
losses from last week, when jitters over a new coronavirus variant roiled
(AP) -- Stocks rose broadly on Wall Street Monday, nearly reversing the S&P
500's losses from last week, when jitters over a new coronavirus variant roiled
The benchmark index rose 1.2%. More than 85% of stocks in the index gained
ground, with technology companies and banks accounting for a large slice of the
gains. The rally also included airlines, cruise lines and other travel-related
companies that stand to benefit from the economy staying clear of more
The Dow Jones Industrial Average rose 1.9%, while the Nasdaq composite
gained 0.9%. Small-company stocks outpaced the broader market, sending the
Russell 2000 index 2% higher. Long-term bond yields rose, also making up a big
portion of what they lost last week.
Wall Street was encouraged by comments from Dr. Anthony Fauci, the White
House's chief medical adviser, who said early indications suggested that the
omicron variant of COVID-19 may be less dangerous than the delta variant. It
will still take a few weeks to learn whether omicron is more contagious, causes
more severe illness or evades immunity.
"The COVID concerns from last week maybe aren't as pronounced, and some of
the geopolitical tensions maybe are not quite as pronounced," said Willie
Delwiche, investment strategist at All Star Charts. "At least for a day, people
feel better about it."
The S&P 500 rose 53.24 points to 4,591.67. The Dow gained 646.95 points to
35,227.03. The Nasdaq rose 139.68 to 15,225.15. The Russell 2000 picked up
44.17 points to 2,203.48.
Bond yields rose, which benefits banks. The yield on the 10-year Treasury
rose to 1.44% from 1.33% late Friday. JPMorgan Chase rose 1.2%.
Delwiche said that the rise in the 10-year bond yield says more about
investors' confidence in the economy than the pickup in stocks.
"Seeing yields in the 10-year get back above 1.40% is the most encouraging
development," he said. "It's hard to make an optimistic case of the U.S.
economy if yields are moving lower."
U.S. crude oil prices rose 4.9% and helped send energy stocks higher. Exxon
Mobil rose 1.1%.
Airlines, cruise operators and a wide range of travel-related companies made
solid gains. Norwegian Cruise Line vaulted 9.5% for the biggest gain in the S&P
500. Rivals Carnival and Royal Caribbean jumped 8.1% and 8.2%, respectively.
American Airlines climbed 7.9%, while United Airlines gained 8.3%. Expedia
Group rose 6.7%. The travel industry has been under pressure over concerns
about the latest coronavirus variant and the potential for it to crimp economic
activity in the midst of the busy holiday season.
Shares in COVID-19 vaccine makers fell. Moderna slid 13.5% for the biggest
decline among S&P 500 stocks. Pfizer dropped 5.1% and BioNTech slumped 18.7%.
The stock market is coming off of a choppy week as investors gauged the
threat from COVID-19, along with a mixed batch of job market data and lingering
inflation concerns. The S&P 500 posted two straight weekly losses heading into
this week. The benchmark index is up 22.3% for the year.
Investors are still reacting to the Federal Reserve's plan to hasten the
withdrawal of its support for the market and economy, said Michael Arone, chief
investment strategist at State Street Global Advisors.
The central bank plans to speed up the pace at which it trims bond
purchases, which have helped keep interest rates low. That has raised concerns
that the Fed will raise its benchmark interest rates next year sooner than
"What you're seeing now is that is being priced into markets and that
underlying shift in expectations is starting to play out in market leadership,"
Banks and other sectors that benefit from higher interest rates are starting
to lead the market higher, while industries that typically suffer from higher
rates, like technology stocks, are lagging, he said.
Investors will get more economic data this week that could help give them a
clearer picture of the economy.
The Labor Department will release its job openings and labor turnover survey
for October on Wednesday, along with its weekly unemployment benefits report on
Thursday. Wall Street will get another update on inflation when the Labor
Department releases the Consumer Price Index for November on Friday.
A mix of corporate news helped send several stocks higher. Del Taco
Restaurants surged 66.1% on news it is being bought by Jack in the Box.
Department store operator Kohl's rose 5.4% after activist investor Engine
Capital LP pushed for a sale or spin off.
BuzzFeed fell 11% in its market debut after the digital media company went
public through a merger with a special purpose acquisition company.
The price of Bitcoin, which fell sharply on Friday, steadied by late
afternoon Monday, edging up 0.1% to $48,947, according to Coindesk.