The three major U.S. stock indexes rallied on Monday as investors prepared for the weeks intense earnings reports, leading the market in large technology stocks, and lawmakers continued to negotiate a new round of stimulus.
The Dow Jones industrial average rose 114.88 points, or 0.4%, to 26584.77. The S & P 500 closed up 0.7% to 3239.41, with the Nasdaq composite leading the market, up 1.7% to 10536.27.
Large technology stocks rose collectively, with apple up 2.37%, Amazon up 1.54%, NYSE soaring 3.16%, Google up 1.41%, Facebook up 1.21%, and Microsoft up 1.27%.
Novel coronavirus pneumonia vaccine was released by the US government after Moderna was allocated $472 million, and Moderna shares rose 9.2%.
Gold stocks also rose after the gold price hit a record high, with Anglo gold up 9.5%, cordera mining up 9.6% and Barrick gold up 5.19%.
However, aviation stocks generally fell, with Boeing down 2.05%, Delta Airlines down 1.81%, Southwest Airlines down 0.38% and United Airlines down 1.4%.
Todays market is relatively calm, basically continuing the rally in early July, while there is still a lot of uncertainty in the market, including high expectations for the quarterly earnings of technology giants, said Charlie Ripley, strategist at Allianz investment management
This week will usher in the peak of corporate financial reporting, including McDonalds, Pfizer, Google parent company alphabet, apple, Amazon and AMD will release quarterly performance reports this week.
By Fridays close, 128 S & P 500 companies had reported results, with 81% exceeding analysts expectations, according to refinitiv. However, the novel coronavirus pneumonia epidemic affected corporate profits, and the overall profit of the S & P 500 index was down by more than 40% from the same period last year.
However, the S & P 500 index has risen 1.5% since the third quarter earnings season, which began on July 14, as investors had long anticipated a decline in corporate earnings. Ed Yardeni, an investment strategist at Yardeni research, said: even if the average expected profit of a company falls, it will not prevent the stock price from soaring. Investors have been prepared for the decline in corporate profits in the second half of this year. However, if the number of confirmed cases continues to grow in the future, the economic recovery may be hindered or even interrupted, and then the profitability of enterprises may fall into a disadvantageous position again.
CEO of technology giant to testify to antitrust sub committee
CEOs of technology companies, including Amazon, Facebook, apple and Googles parent company alphabet, will testify before the house antitrust Sub Committee on Wednesday, when they will give their opinions on the possibility of measures such as new competition laws or spin offs.
In the past two years, as technology companies, especially Amazon, apple, Facebook and alphabet, have become increasingly dominant in the industry, there have been concerns about their monopoly. At a time when the market is in doubt about the valuation of technology stocks, there has been a growing call for more regulation of these technology giants.
The house antitrust sub committee has been studying the market share advantages of Silicon Valleys technology giants in businesses including digital advertising and e-commerce, including but not limited to Facebooks market share in social media, Googles dominant position in digital media advertising, and Amazons use of third-party business data to support its product sales and reduce competition And Apples application control.
There is growing evidence that a small number of technology companies have taken key initiatives in controlling online commerce, content and communications. In order to maintain the stability of the industry, we must investigate the current situation of competition in the digital market and ensure the integrity of antitrust laws, said Jerry Nadler, chairman of the house Judiciary Committee
Members of Congress are divided on the details of the aid bill, and the stimulus plan may be difficult to pass this month
On the other hand, Senate Republicans announced the first part of the fiscal stimulus plan on Monday, including a rescue package for small businesses. The bill includes providing relief to unemployed Americans, paying individuals and families up to $1200 and $2400, respectively (individuals or couples with an average income of $99000 or more do not have the subsidy), and the bill will reduce the subsidy of $600 a week due this month to the maximum of $200 a week, and gradually transition to 70% of pre epidemic wages. At the same time, the bill will allow small businesses whose operating income has dropped by more than 50% to apply for a second round of assistance, will approve $100 billion in loans to cyclical industries and companies in low-income areas, and provide $105 billion to help schools reopen in the autumn.
U.S. Treasury Secretary mnuchin and White House chief of staff meadows will meet with Senate Democratic leader Schumer and House Speaker Nancy Pelosi at 6:00 p.m. local time to discuss the stimulus package and other issues.
Some analysts pointed out that due to the differences between the two parties on the details of the aid bill, the process of its passage has become rather slow. The biggest difference between Republicans and Democrats is unemployment benefits and aid to state and local governments, and it may take more than a week for them to reduce their differences, which means it is unlikely to reach an agreement before July 31, said Aneta markowska, an economist at Jefferies, an investment bank