The Business Times

US: S&P 500 ends over 4,000 for first time

Published Fri, Apr 2, 2021 · 06:01 AM

[NEW YORK] The S&P 500 finished above 4,000 for the first time Thursday setting a record amid rising confidence in the US economic recovery, while oil prices rallied after petroleum producers agreed to limited output increases.

The heady session marked a strong start to the second quarter a day after President Joe Biden formally announced a massive US$2 trillion infrastructure plan which he said would create millions of good jobs.

Mr Biden's proposal faces hurdles on Capitol Hill, but investors remain bullish about the coming months in the wake of the giant fiscal stimulus package approved in mid-March, and the accelerating coronavirus vaccine campaign in the US.

Expectations of a strong corporate earnings season later this month are prompting investors to make fresh bets on stocks, analysts said.

Investors also were cheered by data showing a strengthening rebound in US manufacturing in March.

"Today is just one of those days you look across the board and it seems to just be pretty good," said TD Ameritrade market strategist JJ Kinahan, who attributed the bounce in tech shares partly to the ebbing of US Treasury bond yields.

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All three major indices advanced, with the broad-based S&P 500 surging 1.2 per cent to 4,019.87.

COVID-19 SPIKE

European equities also climbed despite downcast developments in the region's Covid-19 pandemic.

The World Health Organization slammed Europe's vaccine rollout as "unacceptably slow" as the region sees a "worrying" surge in coronavirus infections.

The organisation said the sluggish rollout was "prolonging the pandemic" and described Europe's virus situation as "more worrying than we have seen in several months." That criticism came after French President Emmanuel Macron announced a limited nationwide lockdown to battle soaring Covid-19 cases, while Brazil feared further devastation was ahead after its deadliest month of the pandemic so far.

Elsewhere, crude futures surged more than 3 per cent as the Opec+ group of oil producers agreed to modest production increases starting in May.

Analysts took the agreement in stride, viewing the measured increases as a prudent response given an expected rise in demand later this year.

While rising Covid-19 cases in key economies probably will lead to "some signs of softness" in oil prices in the near-term, "we still see inventories draining at a rapid pace" as demand picks up, Morgan Stanley said in a note.

Shares in Deliveroo steadied one day after the app-driven meals delivery group lost more than a quarter of its value on its stock market launch in London.

AFP

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