The S&P erases its 2020 losses and American Airlines reveals their shares have DOUBLED in price as Trump hails 'big day for the economy' off the back of reopening and a huge jobs report
The S&P 500 has erased its 2020 losses after the market saw a boost on Monday morning, with American Airlines stock prices doubling in the space of a month, prompting President Trump to declare it's a 'big day'.
The S&P 500 was up 0.5% in the first few minutes of Monday's trading, bringing it back within 5.2% of its record set in February. But by Monday afternoon it was up 1.2%, or 38.46 points, to 3,232.39. It was up 47% from its March low due to the coronavirus pandemic shutdowns.
The Dow Jones Industrial Average rose more than 263 points Monday morning and by the afternoon it was up 461.46 points, or 1.7%, to 27,572.44.
As more major cities in the US, such as New York and Las Vegas, began to reopen, The Nasdaq composite was initially up 0.1% but that increased to 1.1%, or 110.66 points, at 9,924.74.
The market had seen a boost Friday when the government said that employers added 2.5 million jobs to their payrolls last month, although economists were expecting to see 8 million more lost.
'Big day for Stock Market. Smart money, and the World, know that we are heading in the right direction,' Trump tweeted. 'Jobs coming back FAST. Next year will be our greatest ever!'
President Trump said Monday it's a 'big day for the stock market' after the Dow rose more than 250 points and American Airlines announced stocks have doubled in a month
By Monday afternoon the S&P 500 was up 1.2%, or 38.46 points, to 3,232.39. It increased 47% from its March low when it was hit due to coronavirus pandemic shutdowns (pictured)
The Dow Jones Industrial Average kept climbing Monday and was up 461.46 points, or 1.7%, to 27,572.44
The Nasdaq was initially up 0.1% Monday but that increased to 1.1%, 110.66 points, at 9,924.74
Stocks have been rising since late March, at first on relief after the Federal Reserve and Capitol Hill pledged to support the economy and more recently on hopes that the recovery may happen more quickly than forecast.
Stocks surged on Friday, with the tech-heavy Nasdaq closing within a striking distance of its February 19 all-time peak, after the unemployment rate in May unexpectedly fell.
States across the country are slowly relaxing restrictions on businesses meant to slow the spread of the coronavirus outbreak, which is raising expectations that the economy can pull out of its coma.
The Labor Department's employment report on Friday showed the jobless rate falling to 13.3% last month from 14.7% in April, helped by restaurants and bars, which added 1.4 million jobs after losing 6 million in April and March.
As optimism strengthens that the worst of the coronavirus-induced recession may have already passed, New York City began Phase One reopening on Monday, allowing construction and 'nonessential' retailers to start operating again with some restrictions.
American Airlines stocks were up 7% from pre-market on Friday. At $19.90, shares had doubled compared to this time last month and increased 94% from two months ago
AA said that it plans to increase its capacity for July by 55 percent compared to last year
Hammered shares of cruise line operators and airlines, including Carnival Corp, Royal Caribbean Cruises Ltd, American Airlines and United Airlines Holdings, climbed between 7% and 16.5% in premarket trading.
Planemaker Boeing Co gained 8.2%, set to add to its 40% surge last week.
American Airlines stocks were up 7% from pre-market on Friday. At $20, shares had doubled compared to this time last month and increased 94% from two months ago. AA said that it plans to increase its capacity for July by 55 percent compared to last year.
Since Friday, Delta Air Lines (DAL) shares increased 5.7% to $36.12 each but so far this year stocks have decreased in value more than 44%.
Compared to last week, United Airlines (UAL) increased by 7.5% to $45.59, Southwest Airlines (LUV) shares got a 3.25% boost to $39.42 each, and JetBlue Airways (JBLU) shares were valued 6.8% higher at $14.64 each.
The TSA reported Sunday that there was a 30% increase in checkpoint traffic compared last week, surpassing 400,000 passengers for the first time since March 22.
Compared to the same time last year, traffic is still down 83 percent.
It follows up on modest moves made in Europe and Asia, while Treasury yields were holding near their highest levels in months.
Treasury yields have been climbing in recent days, reflecting rising expectations in the market for the economy and inflation. The 10-year Treasury yield dipped to 0.89% from 0.90% late Friday, but it´s up sharply from 0.66% a week earlier.
Too quick a rise in yields could slow spending and the anticipated economic recovery, though. It can also be a heavy weight on the stock market.
Higher yields make bonds more attractive as investments, which would pull some investors´ dollars away from stocks. High-dividend stocks would likely get hurt in particular, because some income investors had turned to them instead of bonds when yields were lower.
Stocks that would benefit most from a growing economy, meanwhile, were leading the market to continue their recent trend.
Energy producers, banks and industrial companies were leading the S&P 500.
Smaller company stocks rose more than the rest of the market, which often happens when expectations for the economy are rising. The Russell 2000 index of small-cap stocks was up 1.7%.
Trading was closed March 23 in response to the coronavirus pandemic. Pictured is a view of the New York Stock Exchange entrance on May 28 in New York City
Trading reopened May 26. Pictured, Andrew Cuomo rings the opening bell with NYSE President Stacey Cunningham
The S&P erases its 2020 losses and American Airlines reveals their shares have DOUBLED in price as Trump hails 'big day for the economy' off the back of reopening and a huge jobs report
![The S&P erases its 2020 losses and American Airlines reveals their shares have DOUBLED in price as Trump hails 'big day for the economy' off the back of reopening and a huge jobs report]()
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June 09, 2020
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