Trader Ashley Lara works on the floor of the New York Stock Exchange, Tuesday, July 20, 2021. Stocks are opening higher on Wall Street Tuesday as investors shake off a rout a day earlier brought on by concerns about the spread of a more contagious variant of COVID-19. (AP Photo/Richard Drew)
By Damian J. Troise and Alex Veiga
Stocks jumped on Wall Street Tuesday, making up much of the ground they lost a day earlier when worries flared about spreading cases of the more contagious variant of COVID-19.
The comeback was the latest rebound following a pullback as investors continue to try and assess how badly rising infections will hurt the economic recovery.
The S&P 500 rose 64.57 points, or 1.5%, to 4,323.06. The gain erased most of the benchmark index's loss from Monday's 1.6% drop, its biggest since May.
Airlines, cruise operators and other stocks that sank a day earlier were back in the winning column. American Airlines climbed 8.4% and Carnival gained 7.5%. Technology, financial, industrial and health care stocks also powered a big share of the benchmark index's broad gains.
The Dow Jones Industrial Average rose 549.95 points, or 1.6%, to 34,511.99. The blue-chip index lost 725 points a day earlier. The Nasdaq composite gained 223.89 points, or 1.6%, to 14,498.88.
Small company stocks mounted the strongest comeback. The Russell 2000 index outpaced the other major indexes with a gain of 63.62 points, or 3%, to 2,194.30.
The sharp one-day rebound for the broader market shows yet again just how choppy trading has been as investors try to figure out the lingering virus' impact on inflation, the broader economy and businesses ranging from airlines to banks. The broader market has managed to keep gaining ground even with all the churn and the benchmark S&P 500 notched several records over the last few weeks.
The spread of the more contagious delta variant of COVID-19 has become a worry spot for investors and policymakers. The Centers for Disease Control has said an estimated 83% of cases in the U.S. are tied to the delta variant of the virus. While tens of millions of Americans have gotten vaccinated, there remains a significant percentage of Americans who are either reluctant or outright hostile to the idea of being vaccinated.
Los Angeles Country last weekend reinstituted an indoor mask mandate as the region's infection rate was climbing quickly yet again. Other parts of the country, like Southern Missouri, are flooded with COVID cases that are straining hospitals once more.
Bond yields fell sharply on Monday on fears that the strong economic recovery from the pandemic could be put at risk from additional lockdowns or coronavirus cases. The yield on the 10-year Treasury note dipped as low as 1.14% early Tuesday, but has reversed course and is up to 1.21% from 1.18% the day before. A week ago it was trading at 1.42%.
“We’re seeing a more dramatic extension of what we experienced over the last couple of weeks, which is really the market searching for a narrative,” said Yung-Yu Ma, chief investment strategist at BMO Wealth Management.
Investors are looking for whatever clues they can get to better gauge the continued trajectory of the economic recovery. Everything from comments from the Federal Reserve to outlooks from companies and economic data are being used to get a clearer picture of what the economy might look like throughout the rest of this year and into 2022.
Wall Street is also in the midst of earnings reporting season. IBM rose 1.5% after the company reported better than expected revenue and profits, helped by its cloud computing business. Hospital operator HCA Healthcare jumped 14.4% for the biggest gain in the S&P 500 after handily beating Wall Street’s second-quarter profit and revenue forecasts.
Outside of earnings, drug distributors made some big moves following reports that they are on the verge of $26 billion settlement over opioid lawsuits. AmerisourceBergen rose 3.5% and McKesson rose 3.2%.
Paint and coatings maker PPG Industries fell 4.4% for the biggest decline in the S&P 500 after its second-quarter profit fell short of analysts' forecasts and it faces supply chain issues and higher raw materials prices.
With real estate being a largely male-dominated industry, Stephanie Shojaee, vice president and chief marketing officer at development company Shoma Group, joined Cheddar News to discuss how she took on the gender gap for women to achieve leadership roles, starting at her own company. “It's been very important to teach all the women that work here, especially the younger ones, that they shouldn't change themselves," she said. "You need to be happy with who you are and just keep breaking barriers."
We are already starting to feel the effects of summer. Heat waves in Texas and California are already sending temperatures soaring. That could spell trouble for the nation's power supply. there are new concerns about outages in many areas of the country. Cheddar's Shannon Lanier explains the two main causes of blackouts, and what states are doing to keep the lights on and the air conditioning running.
Pinterest is making a big move as it pushes further into online shopping. The image-focused social media site is acquiring A.I.-powered shopping platform THE YES as it focuses on enhancing the user shopping experience. THE YES's technology gives users a personalized feed of products based on their preferences, and Pinterest is banking on the tech to give it an advantage among other social media apps with built-in shopping features. Julie Bornstein, founder and CEO of THE YES, joins Closing Bell to discuss the company's unique technology, why it agreed to sell to Pinterest, her vision as she takes over shopping initiatives, and more.
Keith Barr, CEO of InterContinental Hotel Group, says he is expecting an 'incredible' summer for his business as pandemic conditions have normalized and people are ready to travel.
Dann Ryan, Chief Investment Officer at Sincerus Advisory, discusses what drove markets lower on Wednesday, as well as what investors are anticipating when it comes to the upcoming CPI report and Fed decision.
U.S. stocks close Tuesday at session highs after a subpar start to the trading day. Tim Chubb, Chief Investment Officer at the wealth advisory firm, Girard, joins Cheddar News' Closing Bell to discuss. 'We're starting to see the moderation of three core things -- we've seen the moderation of prices, we've seen the moderation of wage growth we've seen in the labor market, and we've also seen a moderation of job openings,' he says.
The victims from the USA gymnastics sexual abuse scandal continue to seek justice. Survivors of Larry Nassar are seeking more than one-billion dollars from the FBI for failing to stop the convicted sports doctor when the agency first received allegations. According to a report released by the Justice Department's Inspector General, FBI agents knew
in July of 2015 that Nassar was accused of abusing gymnasts; however, Nassar wasn't arrested until December of 2016. The group that filed the claim includes Olympic medalist Simone Biles and around 90 other women. Louise Radnofsky, sports reporter at The Wall Street Journal, joins Cheddar News' Closing Bell to discuss.
A controversial professional golf tour backed by Saudi Arabia tees off on Thursday. Today, two-time Major winner Dustin Johnson announced he's resigned from the PGA Tour ahead of headlining the Saudi-backed tour, called the LIV Golf Invitation Series. The announcement comes as the PGA tour has threatened disciplinary action for its golfers who take part in the Saudi golf league event, which will also feature notable golf stars like Phil Mickelson and Sergio Garcia; however, LIV Golf's CEO, Greg Norman, told The Washington Post that Tiger Woods rejected a contract worth 'high nine digits' to play in the tour. Chris Bumbaca, reporter for USA Today Sports, joins Cheddar News' Closing Bell to discuss.
CreditCards.com senior industry analyst Ted Rossman compares the Apple Pay Later offering to similar four-step processes at Affirm and Klarna, and says this is a way for the tech giant to dive deeper into the financial industry.
