Stock market: modest increase in New York and Toronto

(Photo: Getty Images)

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MARKET REVIEW. The New York Stock Exchange closed a volatile session modestly higher on Monday, with records for the Dow Jones and the S&P 500 as the Nasdaq rebounded pending a Fed monetary meeting on Tuesday and Wednesday.

The Toronto Stock Exchange advanced at the start of the session despite losses in some sectors due to a 9% jump in the telecommunications sector, propelled by the acquisition of Shaw Communications by Rogers.

The clues

In Toronto, the S&P/TSX ends the day with a gain of 103 points, or 0.55%, to 18,954 points.

In New York, the S&P 500 rose 25 points, or 0.65%, to 3,968 points.

The Dow Jones rose 174 points, or 0.53%, to 32,953 points.

The Nasdaq climbed 139 points, or 1.05%, to 13,459 points.

The context

The optimism about the economic reopening remained the main catalyst and benefited the cyclical stocks of the old economy.

But technology stocks, which in recent sessions have suffered from rising bond yields and inflation fears, made a good comeback late in the session. They were helped by “a slight drop in yields on 10-year Treasury bills,” which stood at around 1.60% against 1.62% on Friday, said Peter Cardillo of Spartan Capital Security.

“You still have this rotation of stocks from the new economy to stocks from the old economy even if it seems that the Nasdaq has bottomed out,” added the analyst, citing among the big names in tech, Apple (+ 2.45%) and Cisco (+ 1.21%) who rose against Amazon (-0.25%) and Microsoft (-0.94%) who lost ground.

A favorable index on manufacturing activity in the New York area showed that activity had climbed to its highest level since July 2020. Prices paid to suppliers are also at their highest for 10 years, noted the Empire State monthly indicator.

“This clue was good. I am surprised that rates have not reacted more “by rising in response to the outlook for overheating and inflation, Mr. Cardillo said.

“The reason is that we are starting the FOMC meeting on Tuesday. The markets are waiting to see what the Fed will say, ”he added.

The week will be marked on Wednesday by the press conference of Jerome Powell, the chairman of the Fed, after the meeting of the Monetary Committee of the Central Bank. The Fed is expected to reiterate the status quo, with overnight rates at zero, but investors will be watching its new economic forecast.

As the vaccination campaign progresses well in the United States, airline headlines have soared as American Airlines (+ 7.70%) or United Airlines (+8,26%).

The American test lab GenMark, which will be bought by the Swiss Roche for $ 1.8 billion, took almost 30%.

The title of the chain of cinemas AMC, which intends to reopen its cinemas in California, in favor of stock marketers, and climbed 25.81%.

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