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S&P 500 surges in strongest one-day rise since June

S&P 500 surges in strongest one-day rise since June

FILE PHOTO: Morning sunlight falls on the facade of the New York Stock Exchange (NYSE) building after the start of Thursday's trading session in Manhattan in New York City, New York, U.S., January 28, 2021. REUTERS/Mike Segar

REUTERS: The S&P 500 surged on Monday in its strongest one-day gain since June as bond markets calmed after a month-long selloff, while another COVID-19 vaccine getting U.S. approval and fiscal stimulus bolstered expectations of a swift economic recovery.

Johnson & Johnson ended up 0.5per cent, but off earlier highs, after it began shipping its single-dose vaccine after it became the third authorized COVID-19 vaccine in the United States over the weekend.

President Joe Biden scored his first legislative win as the House of Representatives passed his US$1.9 trillion coronavirus relief package early Saturday. The bill now moves to the Senate.

U.S. bond yields eased after a swift rise last month on expectations of accelerated inflation due to bets on an economic rebound. The U.S. 10-year treasury yield dipped to 1.449per cent after hitting a one-year high of 1.614per cent.

"The sentiment is risk-on with more investors showing interest towards cyclical stocks while a positive vaccination drive and better macro numbers are hinting towards a better growth environment," said Keith Buchanan, portfolio manager at Globalt in Atlanta.

Data showed U.S. manufacturing activity increased to a three-year high in February amid an acceleration in new orders.

All 11 S&P 500 sectors rallied, led by financials and technology.

Apple Inc, Microsoft Corp, Facebook Inc and Amazon.com Inc bounced back after a selloff last week in tech stocks. Apple rose over 5per cent and was the strongest contributor to the S&P 500's gains.

In extended trade, Zoom Video Communications jumped 10per cent following its quarterly report.

The S&P 500's rebound from its 50-day moving average, touched after Friday's decline, is a bullish sign that is adding to investors' enthusiasm, said CFRA Research Chief Investment Strategist Sam Stovall.

"It's a positive signal, at least in the near term, that the recent weakness has dissipated," Stovall said.

The Dow Jones Industrial Average surged 1.95per cent to end at 31,535.51 points, while the S&P 500 gained 2.38per cent to 3,901.82.

The Nasdaq Composite jumped 3.01per cent to 13,588.83.

The Russell 2000 index of smaller companies surged 3.37per cent, putting its gain in 2021 at over 15per cent, compared with the S&P 500's gain of about 4per cent in the same period.

Boeing Co jumped 5.8per cent after United Airlines Holdings Inc ordered 25 new 737 MAX aircraft and moved up the delivery of others as it prepares to replace aging jets and meet expected post-pandemic growth in demand.

Warren Buffett's enthusiasm for the future of the United States and his company Berkshire Hathaway Inc has not been dimmed by the coronavirus pandemic, according to his annual letter to investors. Berkshire's shares rallied 3.6per cent.

Perrigo Co Plc jumped 4.7per cent as the consumer healthcare products company said it would sell its underperforming generic drugs business for US$1.55 billion.

Advancing issues outnumbered declining ones on the NYSE by a 3.81-to-1 ratio; on Nasdaq, a 4.29-to-1 ratio favored advancers.

The S&P 500 posted 48 new 52-week highs and no new lows; the Nasdaq Composite recorded 197 new highs and 17 new lows.

Volume on U.S. exchanges was 12.1 billion shares, compared with the 15.1 billion average for the full session over the last 20 trading days.

(Reporting by Noel Randewich; Additional reporting by Medha Singh and Shashank Nayar in Bengaluru; Editing by Lisa Shumaker)

Source: Reuters

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