Stocks Drift Higher On Wall Street After Big Gain In August

Tuesday, September 1st 2020, 1:01 pm
By: Associated Press

Wall Street shook off a sluggish start and was moving tentatively higher in midday trading Tuesday, a day after the market wrapped up its fifth monthly gain in a row.

The S&P 500 was up 0.3%, as more strength in technology stocks and gains in retailers and other companies that rely on consumers offset declines in health care, utilities and energy companies. Treasury yields fell slightly.

Stocks perked up following the release of some encouraging economic data. The Commerce Department said U.S. construction spending edged higher in July, breaking a string of losses due to disruptions caused by the pandemic. And the Institute for Supply Management said its latest manufacturing index increased last month, reflecting a faster pace of expansion by American factories.

The modest gains followed a broad slide in European markets and a mixed finish across stock indexes in Asia.

Zoom Video Communications soared 34.8% a day after the now-ubiquitous video conferencing service reported another quarter of explosive growth. Tesla fell 2.9% after the electric car maker said it would sell up to $5 billion in stock.

Walmart led the gainers in the S&P 500 as investors welcomed news of the retail giant’s debut later this month of a of a service offering members same-day delivery, fuel discounts and other perks. The stock was up 5.8%.

The Dow Jones Industrial Average was up 79 points, or 0.3%, to 28,511 as of 11:58 a.m. Eastern time after waffling between small gains and losses in the early going. The Nasdaq was up 0.9% a day after closing at an all-time high.

The stock market has continued its remarkable turnaround since plunging nearly 34% early this year as the coronavirus pandemic knocked the economy into a recession. The S&P 500 closed out August with a 7% gain, its best showing since April. It’s now up 8.6% this year, while the tech-driven rally has powered the Nasdaq to a 32% gain.

Encouraging data as broad swaths of the economy have reopened this summer have helped stoke investor optimism about a recovery. The question is whether that’s going to be enough to keep the market moving higher when so much uncertainty remains about the pandemic’s lasting impact on companies and consumers.

Investors will be looking for more clues on the state of the economic recovery this week amid what is going to be a busy week for economic news, including the government’s monthly U.S. jobs report on Friday.

The yield on the 10-year Treasury fell to 0.69% from 0.71% late Monday.

Oil prices were headed higher. Benchmark U.S. crude oil was up 1.2% to $43.13 a barrel. Brent crude, the international standard, was up 1.3% at $45.85 a barrel.

In Europe, France’s CAC 40 was down 0.2%, while Germany’s DAX added 0.1%. Britain’s FTSE 100 fell 1.8% a day after it was closed for a public holiday.