Futures jump, airline stocks up, S&P down 1% this year

Stock futures rise slightly, continuing volatile week on Wall Street

People walk by the New York Stock Exchange (NYSE) on May 18, 2020 in New York City.

Spencer Platt | Getty Images

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8:51 am: Stanley Druckenmiller: ‘I’ve been humbled’ by market comeback

Stanley Druckenmiller, founder of Duquesne Capital, said he’s been humbled by stocks’ stellar comeback. “Well I’ve been humbled many times in my career, and I’m sure I’ll be many times in the future. And the last three weeks certainly fits that category,” he said Monday on CNBC’s “Squawk Box.” “What is clearly happening is the excitement of reopening is allowing a lot of these companies that have been casualties of Covid to come back and come back in force. With a combination of the Fed money and, in particular, a vaccine where the news has been very, very good,” he added. In May the longtime investor said “the risk-reward for equity is maybe as bad as I’ve seen it in my career.” Since then the S&P 500 has gained more than 11%. – Stevens, Franck

8:49 am: ‘Time to make the dough,’ KeyBanc says in Dunkin’ Brands upgrade

KeyBanc upgraded shares of Dunkin’ Brands to an overweight rating based on improving same-store sales as restaurants around the country begin to reopen. In a note titled “time to make the dough,” the firm said the restaurant chain has executed well during the pandemic. “We believe Dunkin’s commitment to better execution of its core menu (e.g., coffee, donuts, and breakfast sandwiches), new beverage-led innovation, and national value (e.g., Go2s, Dunkin’ Run) will help the brand reassert its leadership position in the morning daypart (~60% of sales) and allow it to better compete in the afternoon when the nation returns to work,” analyst Eric Gonzalez wrote in a note to clients. The firm’s $78 target represents a 14% rally from Friday’s closing price. Shares of the fast food chain gained more than 5% during Monday’s premarket trading. – Stevens

8:15 am: Energy stocks moving higher after posting best week on record

Energy stocks moved higher on Monday, with the Energy Select Sector SPDR (XLE) jumping more than 6% in premarket trading. The sector gained 15.41% last week for its best week on record as oil prices rose to three month highs. Over the weekend OPEC and its oil-producing allies agreed to extend their record production cut – equivalent to about 10% of worldwide demand – for another month in an effort to further support prices. – Stevens

8:02 am: Boeing jumps on reopening optimism and analyst’s recommendation

Shares of Boeing soared 8.5% in premarket trading, putting the stock on track for its sixth straight day of gains. Boeing is benefiting from the overall optimism about the reopening of the economy. Meanwhile, Seaport Global Securities initiated coverage of Boeing with a buy rating, saying the worst of pandemic-related risk is now priced in. The firm set a 12-month price target of $277 for the plane maker, which would translate into a more than 30% gain from Boeing’s close on Friday of $205.43. Shares of Boeing have risen 54% in the past month, trimming its 2020 losses to about 36%. –Li, Schacknow 

7:59 am: Where the market stands

After last week’s rally, here’s where the market stands:

  • Dow gained 6.81% last week for its best weekly performance since April 9
  • Dow is 8.31% below its record high
  • Dow is down 5% this year
  • S&P 500 gained 4.91% last week for its best weekly performance since April 9
  • The S&P is 5.88% below its record high
  • The S&P is down 1.14% this year
  • The Nasdaq Composite rose 3.42% last week for its third straight positive week
  • The Nasdaq Composite rose to a new all-time intraday high on Friday, but did not close at a new record
  • The Nasdaq Composite closed 0.03% below its all-time closing high on Friday
  • For the year the Nasdaq Composite has gained 9.38%. – Hayes

7:55 am: AstraZeneca no longer interested in Gilead Sciences, report says

London-listed AstraZeneca has abandoned tentative, early interest in merging with Gilead Sciences, the American biopharmaceutical company behind coronavirus treatment remdesivir, according to The Times. The English-Swedish company is thought to have scrapped a deal because it would have distracted it from its own therapy pipeline, according to the report. The Times report, published on Monday, poured cold water on a Bloomberg News report that on Sunday said AstraZeneca made a preliminary approach to Gilead in May for a potential combination. That deal, had it occurred, would have been the largest health-care deal on record. — Franck

7:50 am: Fed to meet with some big talk on the agenda

One of the big events for markets this week will be the two-day Federal Open Market Committee meeting that starts Tuesday. Wall Street is expecting a lot of talk but not much action. Among the main topics for the Fed’s policymaking group will be whether to implement so-called yield curve controls, which would entail buying bonds with the intention of keeping yields at lower levels. In tandem with that, the committee is likely to discuss strengthening its forward guidance, or commitment to keeping short-term rates at low levels until certain economic benchmarks are met. However, markets are not expecting definitive moves on either topic. Fed Chairman Jerome Powell will conduct a virtual news conference Wednesday after the meeting. – Cox

7:47 am: RBC raised its price target on Amazon to a Street high $3,300

RBC upped its price target on Amazon to $3,300 from $2,700 and said it sees the company continuing to benefit from the “shift to e-commerce” in the wake of the coronavirus pandemic. The firm said the e-commerce giant is a “structural winner” after the firm conducted its annual online shopping survey. “AMZN-specific results clearly support the idea that AMZN is likely the best global play off of online retail,” analyst Mark Mahaney said. CNBC PRO subscribers can read more here– Bloom

7:46 am: Reopening trades up big again

Travel stocks – airlines, hotels and cruise lines – looked to extend last week’s rally as demand starts to pick up with coronavirus lockdowns easing. United Airlines was up 10% in premarket trading on Monday, while Delta jumped 8%. Shares of Carnival and Royal Caribbean were up more than 10% each in premarket. Hilton and Marriott both gained more than 3%. Retailers, also tied to the reopening of the economy, were among the biggest gainers with Kohl’s and Nordstrom both popping more than 8% in premarket.— Li

7:28 am: Stock futures jump as market looks to build on recent optimism

U.S. stock index futures were sharply higher Monday, with the Dow Jones Industrial Average set to jump more than 200 points at the open, for a gain of 0.8%. The S&P 500 was slated to open 0.4% higher, while the Nasdaq Composite was poised to begin trading around the flatline.

Monday’s action builds on recent strength in the market as the economy’s reopening as well as better-than-expected economic data have pushed the major averages higher. On Friday, the Nasdaq Composite rose to a new all-time intraday high, becoming the first of the major indexes to wipe out its coronavirus-induced losses. The S&P 500 is now down just 1% for the year and is about 6% below its February record high. The Dow has a little more ground to make up and is sitting roughly 8% below its high. The major averages are coming off their best week since early April.

Some outperformers last week included airline stocks. The NYSE Arca Airline Index is coming off its best week on record, after registering a gain of 36.87%. – Stevens 

– CNBC’s Jeff Cox, Chris Hayes, Peter Schacknow and Tom Franck contributed reporting.

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