U.S Stocks Gain on States Reopening
U.S. stocks gained by midday Monday as coronavirus lockdowns have started to ease in some states, signaling confidence in hopes of restarting the economy.
The S&P 500 rose 1% by midday to 2,876.20 points, while the Dow Jones climbed 316.90 points to 24,092.17. One of the top gainers was the casino operator Las Vegas Sands Corp., (NYSE: LVS) which soared 9% to $47.79 per share. The stock has been rising since the company's executives said last week that it was expecting Asia revenues to rebound quickly. One of its competitors, MGM Resorts International (NYSE: MGM) has also continued to rise on the news, as it surged nearly 9% today to $15.15 per share.
Other strong winners by midday were the Florida-based Norwegian Cruise Line Holdings Ltd., surging 8% to $11.74 per share and the clinical tester Quest Diagnostics Inc., (NYSE: DGX) rising nearly 8% to $114.82 per share.
The news comes as states in Georgia, Oklahoma, and Alaska have started to loosen Covid-19 lockdown restrictions, despite warnings from public health officials that reopenings may be too premature. This afternoon, Texas Gov. Greg Abbott plans on providing a plan on reopening the state.
"In the U.S., another wave of states are preparing to ease coronavirus restrictions," Fiona Cincotta, a market analyst at City Index wrote in a note.
She added, "With fears rising that unemployment could hit 16%, the market is focusing on the benefits of reopening the economy, rather than the concerns of a second wave of infection if measures are eased too soon."
While reopening states is a great short-term move for stock markets, the long term effects could be detrimental it happens too quickly. The last thing we need to do is go through another two months of a lockdown, as 26 million Americans have lost their jobs since the outbreak of the Covid-19 in the U.S., according to data by the Labor Department last week.
Investors are also set for a busy week of financial reports, as 149 S&P 500 companies and 12 components of the Dow will report their results. Among some of them are tech giants Apple Inc., (Nasdaq: APPL) Microsoft Corp., (Nasdaq: MSFT), and, of course, Amazon.com, Inc. (Nasdaq: AMZN).