Stocks made a bullish start to the week Monday, shrugging off an uptick in coronavirus deaths in the U.S. amid a surge in tech and financials.
The S&P 500 rose 4.6%, the Nasdaq Composite surged 4.5% and Dow Jones Industrial Average rose 1,294 points, or 5.1%. The Dow notched its biggest daily point gain ever, as did the S&P. That is still short of the biggest percentage gain for the Dow of 11.08% and 11.58% for the S&P 500 on Oct. 13, 2008.
Officials in Washington state said Monday four new patients had died from Covid-19, taking the total number of deaths in the U.S. to six. But with growing bets the Federal Reserve will cut rates aggressively this month, investors piled into stocks, especially in late trading.
In tech, Apple was the standout as investors cheered an upgrade from Wall Street on the iPhone maker.
Oppenheimer upgraded its rating on Apple to outperform from perform on expectations that demand for Apple would continue despite uncertain nearly 9%.
While infections continue to mount worldwide, Covid-19 cases in China continued to slow, stoking investor hopes that disruptions to supply chains in the country will be resolved sooner rather than later.
WHO Director-General Tedros Adhanom Ghebreyesus said China reported 206 new cases of Covid-19, on Sunday, the lowest number of new cases since Jan. 22.
Financials, mostly banking stocks, also led the broader market higher, after catching a bid into the close thanks to a surge in bond yields.
JPMorgan, Goldman Sachs and Bank of America rose sharply as the 10-Year Treasury yield rebounded from record lows, rising to 1.157% from lows of 1.03%.
On the economic front, U.S. manufacturing activity remained sluggish as data showed the ISM Manufacturing Index fell to a reading of 50.1 in February, short of economists’ estimates of 50.5.
And Costco Wholesale jumped 10% following virus-scare stockpiling at its stores seen over the weekend.
Nio, however, proved an exception to the rally, closing down 0.7%, after Citigroup downgraded the Chinese electric automaker on worries the recent funding deal could prove short-term relief but longer-term pain should sales weakness continue.