S&P 500, Dow Surge Over 1 Percent on Boost From Financials, Boeing

By Reuters
Reuters
Reuters
December 2, 2021 Updated: December 2, 2021

The Dow and the S&P 500 rebounded on Thursday, boosted by financial shares and Boeing in a week so far marked by wild swings on rising angst about the spread of the new Omicron coronavirus variant globally.

Boeing Co. jumped 5.7 percent after China’s aviation authority issued an airworthiness directive on the 737 MAX that will help pave the way for the jet’s return to service in China.

Kroger Co. surged 12.4 percent to top the S&P 500 after the retailer raised its full-year sales and profit forecasts, boosted by sustained demand for groceries.

Payments processors Visa Inc., Mastercard Inc., and American Express Co. added between 4.1 percent and 4.9 percent.

All of the 11 major S&P sectors advanced, with eight of them surging more than 1 percent each. Financials led the pack, rising 3.1 percent.

“Today is a relief rally in markets, but the virus and the Fed’s hawkishness—are going to weigh on the market over the next couple of weeks as markets digest those,” said Joe Saluzzi, co-manager of trading at Themis Trading in Chatham, New Jersey.

“The trajectory into the year-end for U.S. stocks remains choppy. We’re up over 20 percent on the S&P, and a lot of people have nice gains, so I wouldn’t be surprised if they try and lock some of those in prior to year-end.”

Much remains unknown about Omicron, which was first detected in South Africa last month and has been spotted in at least two dozen countries. This uncertainty, coupled with the Federal Reserve shifting its stance away from ‘transitory’ nature of inflation, has led investors scramble for bargains after every drawdown this week.

A second U.S Omicron case was identified in Minnesota on Thursday.

Stellar earnings reports and strong economic growth have powered Wall Street to a series of record highs in November, with the S&P 500 climbing 21.4 percent so far this year.

A Reuters poll of equity analysts said a correction was likely in the next six months, with the benchmark expected to finish at 4,910 by the end of 2022.

At 12:20 p.m. ET, the Dow Jones Industrial Average was up 660.49 points, or 1.94 percent, at 34,682.53, the S&P 500 was up 71.00 points, or 1.57 percent, at 4,584.04, and the Nasdaq Composite was up 132.96 points, or 0.87 percent, at 15,387.02.

Still, the three indexes are tracking weekly losses, with the Dow on pace for its fourth straight fall.

The CBOE volatility index, also known as Wall Street’s fear gauge, was last trading at 27.30 points, a day after hitting its highest level since February.

Travel and leisure stocks bounced back, with the S&P 1500 Airlines and the S&P 1500 Hotels, Restaurant, and Leisure indexes rising 6.1 percent and 3.4 percent, respectively.

Advancing issues outnumbered decliners by a 2.47-to-1 ratio on the NYSE and by a 1.43-to-1 ratio on the Nasdaq.

The S&P index recorded three new 52-week highs and 12 new lows, while the Nasdaq recorded eight new highs and 529 new lows.

By Devik Jain and Anisha Sircar

Reuters