Day Traders Diary
The Dow and S&P 500 climbed to record highs on Monday as a strong bounce in U.S. job growth and solid data in the services sector raised expectations for a swift economic recovery from the pandemic.The Dow Jones Industrial Average finished up 373 points or 1.13%. The S&P 500 gained 1.4%, hitting a new intraday record high. The tech-heavy Nasdaq Composite climbed 1.6% or 225 points.
The Labor Department reported Friday that nonfarm payrolls increased by 916,000 in March, the highest since August 2020, while the unemployment rate fell to 6%. Economists surveyed by Dow Jones were expecting an increase of 675,000 and a jobless rate of 6%.
Meanwhile, a measure of U.S. services industry activity soared to a record high in March. The Institute for Supply Management's non-manufacturing activity index jumped to a reading of 63.7 last month, the highest level in the survey's history.
Tesla shares popped more than 5% as the electric vehicle company reported production and delivery figures that broadly beat expectations.
GameStop shares wiped out their earlier losses and turned positive after the video game retailer said it may sell up to $1 billion worth of stock.
Classic reopening plays like airlines and cruise operators outperformed. American Airlines and United jumped more than 4% each, while Carnival and Norwegian Cruise Line gained 5.9% and 7.8%, respectively.
Bond yields, whose sudden advance spooked some investors in recent weeks, continued to ease. The 10-year Treasury yield fell slightly to 1.71% on Monday.
The stock market is building on its recent strength after President Joe Biden introduced his multitrillion-dollar infrastructure proposal, which focuses on rebuilding roads, bridges and airports, expanding broadband access and boosting electric vehicle use and updating the country's electric grid. The plan will be funded partly by a hike in the corporate tax rate to 28%.
Treasury Secretary Janet Yellen on Monday pushed for a global minimum corporate tax in an effort to keep companies from relocating to find lower rates.
However, Biden's plan faces opposition among Republicans as the $2 trillion plan includes initiatives that they say extend beyond traditional infrastructure issues.
Republican Sen. Roy Blunt of Missouri on Sunday urged the Biden administration to pare back the package to roughly $615 billion and concentrate on physical infrastructure such as roads and airports.
Senate Minority Leader Mitch McConnell, R-Ky., said last week that Biden's plan would not receive Republican support and vowed to oppose the broader Democratic agenda.
On the pandemic front, the U.S. reported another daily record of new Covid vaccinations Saturday, pushing the weekly average of new shots per day above 3 million.
All comments contained herein are for informational purposes only, and should not be considered as a solicitation to buy or sell any security. The firm does not guarantee the accuracy or completeness of the information or make any warranties regarding results from it's usage.