Stocks jumped on Monday, recovering from earlier losses, as the Federal Reserve announced further measures to support the market amid the coronavirus pandemic. The Fed announced Monday it would buy individual corporate bonds in the secondary market. The news sent the major averages to their session highs. This latest announcement builds on that program and shows the Fed will continue to support credit markets during the coronavirus.
Shares of major tech companies led the way
higher for the broader market. Facebook (Symbol: FB) gained 1.7% while
Amazon (Symbol: AMZN) and Netflix (Symbol: NFLX) each
advanced more than 1% as well.
Bank shares added to the gains, with JPMorgan Chase (Symbol: JPM)
and Citigroup (Symbol: C) both rising about 1.4%.
The Dow Jones (Symbol: DIA) closed 0.6% higher.
The S&P 500 (Symbol: SPY) gained 0.8% to end the day, while the Nasdaq (Symbol:
QQQ) advanced 1.4%.
United (Symbol: UAL) and Delta Air
Lines (Symbol: DAL) — The stocks of the major U.S. airlines fell
across the board Monday as reignited fears over the spread of
Covid-19 weighed on companies with exposure to travel demand. United fell 4.1%, while JetBlue (Symbol: JBLU) and
Delta lost 3.2% and 2.9%.
Investors fear a resurgence in new coronavirus cases could lead
governments to reinstitute travel restrictions and prolong a return to
normal air travel trends.
Moderna (Symbol: MRNA) — Moderna
shares gained more than 3% after
an Israeli news outlet said the country’s government was buying the firm’s
coronavirus vaccine, which recently entered its final stages of clinical
Shopify (Symbol: SHOP) — The
e-commerce stock rose 5.2% after Walmart announced a partnership that
would allow Shopify’s third-party sellers to list on the retail giant’s
website. Analysts also upgraded the stock to overweight from neutral,
forecasting strong revenue growth.
Carnival (Symbol: CCL), Norwegian
Cruise Line (Symbol: NCLH), Royal Caribbean (Symbol: RCL) —
Shares of cruise lines dropped on Monday as investors ditched
riskier stocks on concerns about a second coronavirus wave. Shares of
Norwegian Cruise Line fell 4.9% and Carnival dropped 5.2%.
Royal Caribbean ticked 2.9% lower.
RH (Symbol: RH) — An analyst at Loop
Capital upgraded RH to buy from hold, noting the home furnishing companies
is “well positioned” for the “post-pandemic landscape.” The analyst also
hiked his price target on the stock to $300 per share from $250. RH shares
traded 4.7% higher around $246 per share.
Six Flags (Symbol: SIX) — Shares of
the theme park company jumped 3.5% after research firm B. Riley FBR upgraded
the stock to buy from neutral and raised its price target to $31 per share
from $27. The firm said in a note that it is easy for theme park operators
to turn a profit even with limits on capacity due to health concerns. For
Six Flags in particular, the analysts said a possible announcement of a
restart of its China expansion could boost the stock.
BP (Symbol: BP) — BP shares dropped
more than 3% after the energy giant
announced plans to take a writedown of up to $17.5 billion for the current
quarter. CEO Bernard Looney said in a statement the coronavirus outbreak
“increasingly looks as if it will have an enduring economic impact.”
SelectQuote (Symbol: SLQT) — Shares
of the life insurance company gained more than 3%
after Credit Suisse began coverage of the stock with an outperform rating.
SelectQuote went public on May 21 with an IPO pricing of $20 a share, and
now it’s trading above $28 apiece. The stock has gained a few
recommendations from Wall Street analysts since its IPO.
What to watch for on Tuesday: Data on U.S. retail sales and industrial production are scheduled for Tuesday. Fed Chairman Jerome Powell will testify in front of Congress. o be o��