The New York Stock Exchange (NYSE) is seen in the financial district of lower Manhattan during the outbreak of the coronavirus disease (COVID-19) in New York City, April 26, 2020.
Jeena Moon | Reuters
Futures contracts tied to the major U.S. stock indexes held steady at the start of the overnight session Wednesday evening on the heels of yet another robust day on Wall Street and amid one the market’s strongest rebounds on record.
Dow Jones Industrial Average futures lost 1 point, indicating an opening loss of about 20 points when regular trading resumes on Thursday. S&P 500 futures were also fairly muted though Nasdaq-100 futures pointed to an opening decline of about 0.2%.
The overnight moves Wednesday evening followed sharp gains on Wall Street over the last several sessions and a historic start to June.
Wednesday’s gains led the Dow to a three-day winning streak and put the blue-chip index up 3.49% over the first three trading days of the month. The S&P 500 notched its first four-day winning streak since early February.
The Nasdaq 100 index, which tracks the 100-largest nonfinancial companies in the Nasdaq Composite, rose 0.5% to close 0.3% below a record set on Feb. 19. The index has rallied more than 43% from an intraday low set on March 23. The Nasdaq Composite, meanwhile, is just 1.58% below its all-time high.
Traders say the market’s hot streak is large part thanks to optimism about the reopening of the U.S. economy and a barrage of government stimulus.
“May could well end up being the turning point for the viral crisis. The month ended with the virus seemingly under control and with the economy reopening faster than expected,” wrote Brad McMillan, chief investment officer at Commonwealth Financial Network. “June will tell us whether that trend continues. But right now? Things look much better than we could have expected a month ago.”
Data compiled by LPL Financial showed the S&P 500 posted its largest 50-day rally in history. LPL’s research also indicated that stocks were higher 100% of the time six and 12 months after the previous largest rallies on record.
Equity of companies that stand to benefit the most under reopenings, those that bore the brunt of the market punishment earlier in the year, have led the major indexes higher over recent sessions. Cyclical stocks including energy, financials and industrials posted some of the largest gains on Wednesday with each S&P section up 3%, 3.8% and 3.9%, respectively.
Other reopening stocks, such as the airline group, rallied as well. Delta, American and United Airlines jumped 7.8%, 5.6% and 12.5% on Wednesday. Those three stocks are up 26.1%, 11.3% and 26.4%, respectively, over the last month.
Thursday’s forthcoming update to the U.S. unemployment claims threatened to keep the week’s optimism in check.
The Department of Labor is scheduled to release the latest update to initial jobless claims at 8:30 a.m. ET Thursday morning. Though economists polled by Dow Jones expect the government to announce yet another deceleration in the pace of claims, the consensus estimate predicts another 1.8 million Americans filed for insurance during the week ended May 30.
Last week, the Labor Department reported another 2.1 million Americans had filed claims in the week ended May 23.
— CNBC’s Fred Imbert and Gina Francolla contributed reporting.
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