Daily Outlook

Stocks surge, pushing the S&P 500 back above 3,000 for the first time since early March

Stocks surged on Tuesday as optimism grew about the reopening of the economy and a potential coronavirus vaccine. The S&P 500 rallied 1.9%, breaking above 3,000 for the first time since March 5. The Dow Jones Industrial Average rose 577 points, or 2.4%. The 30-stock average also traded at levels not seen since early March, jumping above 25,000. The Nasdaq Composite advanced 1.5% and was less than 4% removed from a record set in February.

The S&P 500 exceeded its 200-day moving average for the first time since March 6. Many technical analysts look at that moving average as a sign of the long-term trend. Rising above it could signal a change in long-term trend from bearish to bullish.

Data out Tuesday also reinforced the belief that the economy has hit its bottom amid the pandemic. A measure of consumer confidence jumped to 86.6 this month from 85.7 in April, according to the Conference Board. Economists polled by Dow Jones expected consumer confidence of 82.3 in May.

Meanwhile, new home sales in April also topped estimates. Sales of new U.S. single-family homes increased by 623,000 last month, beating estimates of 490,000, according to Dow Jones.

The moves Tuesday followed a solid week for Wall Street that saw the 30-stock Dow rise 3.3%, posting its best weekly performance since April. The S&P 500 and Nasdaq also climbed more than 3% last week. The S&P 500 entered Tuesday’s session up more than 34% from a March 23 low.

The number of coronavirus cases in the U.S. topped more than 1.6 million as deaths rose to more than 97,000, a tally from Johns Hopkins University showed as of Monday.

Meanwhile, investors kept an eye on the U.S.-China tensions, which showed signs of escalation over the weekend. White House National Security Advisor Robert O’Brien said Sunday the U.S. will likely impose sanctions on China if Beijing implements national security law that would give it greater control over autonomous Hong Kong.

Stocks surge, pushing the S&P 500 back above 3,000 for the first time since early March, CNBC, May 26

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