Wall Street stages strong recovery on oil rebound, trade optimism
- Consumer discretionary and technology lead gains.
- All 11 major sectors ended the day in the green on Monday.
- Nasdaq Composite adds over 2%.
After starting the day on a strong note, major equity indexes in the U.S. preserved their momentum and closed the day sharply higher ahead of the critical G20 summit in Argentina later this week, at which President Trump and his Chinese counterpart Xi are expected to meet to discuss the trade relations. Although the Wall Street Journal later in the day reported that Trump was planning to move ahead with the increase in the tariff rate, the market reaction was relatively limited.
The trade-sensitive S&P 500 Industrials and Materials indexes added 0.85% and 1.2%, respectively on the day. Previewing the G20 summit, "I don't think you are going see a complete solution to the trade dispute, but you are going to see a path towards a solution," John Lynch, Chief Investment Strategist for LPL Financial in Charlotte, North Carolina, told Reuters.
Expectations over strong holiday-season sales boosted the S&P 500 Consumer Discretionary index on Monday, which closed the day with an impressive 2.6% gain. Additionally, the S&P 500 Technology index, which suffered heavy losses during the recent sell-off, took advantage of the improved sentiment and rose 2.25%. In the meantime, a more than 2% recovery witnessed in crude oil prices helped the S&P 500 ENergy index finish 1.72% higher.
The Dow Jones Industrial Average added 354.36 points, or 1.46%, to 24,640.31, the S&P 500 rose 40.91 points, 1.55%, to 2,673.47 and the Nasdaq Composite gained 142.87 points, or 2.06%, to 7,081.85.
Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
