Wall Street soared above 1.5% on the back of a rally in financial and energy stocks

ILLUSTRATION. Wall Street rallied earlier this week

Source: Reuters | Editor: Anna Suci Perwitasari

KONTAN.CO.ID – NEW YORK. Wall Street appeared mighty with its three main indexes shot up sharply in early trading this week. The financial sector, which has always been pressured by fears of the corona virus pandemic, has revived.

Monday (28/9), the Dow Jones Industrial Average closed up 410.1 points, or 1.51%, to 27,584.06. The S&P 500 index also rose 53.14 points or 1.61% to 3,351.6 and the Nasdaq Composite index also rose 203.96 points or 1.87% to 11,117.53.

The three major stock indexes made solid gains after the longest weekly losses in more than a year for the S&P 500 and Dow Jones last week.

In this trade, the energy and financial sectors, which have usually been hit hardest by the pandemic’s economic shutdown, enjoyed the largest percentage gains among the main S&P 500 sectors.

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“The market is currently led by energy and finance, but it is a very balanced market,” said Tim Ghriskey, Chief Investment Strategist Inverness Counsel in New York. “Every sector is participating in this rally.”

Despite the gains, these three major indexes are still on the way to posting their first monthly losses since March, when markets were in freefall due to lockdown policies related to the coronavirus pandemic.

“Given this weak month, some rebalancing is possible,” Ghriskey added. “The rebalancing will move allocations to equities and some of that might happen today.”

The third quarter will also close on Wednesday (30/9), and despite forecasted losses in September, the S&P and Nasdaq indexes are on track for their best two-quarter winning streaks since 2009 and 2000, respectively.

The lead shares of Apple Inc and Amazon.com once again provided the biggest boost for the S&P 500 and Nasdaq indices today.

Unfortunately, news of a lack of a Covid-19 vaccine and an additional fiscal stimulus package from Washington has weighed on the market in recent sessions.

But US House of Representatives Speaker Nancy Pelosi said in an MSNBC interview that stimulus talks with Treasury Secretary Steven Mnuchin would continue. He also pointed out the possibility of progress towards ending the impasse.

“I’m not sure there’s a chance it will happen before the end of the year, but it is in the news and is giving some traders confidence,” said Ghriskey.

On the other hand, American Airlines Group Inc shares also managed to jump 3.8% after the company announced that it had secured a government loan of US $ 5.5 billion on Friday (25/9). It is also possible for these airlines to access more loans.

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As a result, it also provides a lift to the broader aviation sector. The S&P 1500 Airlines Index closed 4.1% higher.

Boeing extended Friday’s gains, rising 6.4% after Federal Aviation Administration chief Steve Dickson said the agency would conduct an evaluation flight of the 737 MAX this week.

Devon Energy Corp said it would buy peer WPX Energy Inc for US $ 2.56 billion, sending the two companies’ shares soaring 11.1% and 16.4%, respectively.

Uber Technologies Inc’s Ride-hailing platform rose 3.2% after a judge ruled the company could resume operations in London.