Day Traders Diary

6/1/21

The major averages finished mixed as optimism about the economic reopening managed to offset lingering angst about inflation and price pressure. The Dow added 46 points, or 0.25%, after gaining as many as 300 points after the opening bell in New York. The S&P 500 slipped 2 points on weakness in technology stocks offset gains made in energy, materials and financials. The Nasdaq Composite, which had traded for much of the day in the red, finished down 12 points or 0.09%.

Investors began the first week of June on a high note as Covid cases continue to decline and vaccinations rise in the U.S. In a major milestone, more than half the U.S. population has received at least one dose of a Covid vaccination, according to data posted by the Centers for Disease Control and Prevention.

The improving domestic coronavirus situation, coupled with the arrival of summertime weather, sparked another day of strong gains in Wall Street's reopening trades like travel and hospitality.

American Airlines and United Airlines each gained approximately 2% after the Transportation Security Administration said it screened an average of 1.78 million people from Friday through Monday, well above the volumes one year ago and another sign that U.S. air travel has reached a pandemic-era high.

Those volumes are more than six times higher than a year ago but still 22% below Memorial Day weekend in 2019.

Meanwhile, aircraft maker Boeing gained 3.2% after one analyst recommended investors discount near-term hurdles for the Dow component and buy the stock while it's still below where it traded in early 2020.

Shares of cruise-operators Carnival Corp. and Norwegian Cruise Line Holdings, two other reopening bellwethers, jumped more than 2.5% apiece.

West Texas Intermediate oil for July delivery climbed by $1.40, or 2.1%, to settle at $67.72. Its settle represented its highest since 2018.

Meme stock AMC Entertainment rose even after the movie-theater chain sold $230.5 million in new stock to an investor. The shares were up 22% after doubling last week.

The blue-chip Dow and the S&P 500 gained 1.93% and 0.55% in May, respectively, to mark their fourth consecutive positive month. The small-cap Russell 2000 rose 0.11% in May to post its eighth positive month in a row — its longest monthly win streak since 1995.

The Nasdaq gained 2.06% last week to post its best weekly performance since April. However, the tech-heavy composite lost 1.53% in May, breaking a 6-month win streak.

The stock market was closed Monday for Memorial Day.

Despite the better coronavirus figures, investors remain on edge about the potential for a sustained and marked move higher in inflation. Higher prices the result of supply shortages and recovering demand could force the Federal Reserve to hike interest rates and curb asset purchases sooner.

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