(Reuters) – Wall Street’s main indexes jumped more than 1% on Monday, with the S&P 500 and the Dow at record highs as investors cheered strong jobs and services sector reports which bolstered views that 2021 could see the best economic growth in nearly four decades.
An ISM survey for March showed a measure of U.S. services industry activity jumped to a record high. The data comes on the heels of Friday’s report showing U.S. nonfarm payrolls surged by 916,000 jobs in March, well above 647,000 forecast by a Reuters poll of economists.
“Investors are more focused on strong economic growth and how that potential leads to better earnings in the future,” said Robert Pavlik, senior portfolio manager at Dakota Wealth in New York.
With speedy vaccinations and additional government stimulus helping the S&P 500 and the Dow clinch all-time highs, focus now turns to progress on a massive infrastructure plan and the upcoming corporate earnings season for insight on the sustainability of the rally.
The Nasdaq is still about 4% below its record peak from February as high-growth tech stocks attempted to recover from a pullback after a spike in bond yields.
Ten of the 11 major S&P sectors rose, with tech, consumer discretionary and communication services leading gains.
“It is always an encouraging sign when the market rallies on broad economic news. Some of the tech stocks that had come under pressure are seen as may be something that has a little bit more value to them,” Pavlik added.
Energy shares were in a weak spot, tracking a fall in oil prices as producers decided to increase output.
At 11:45 a.m. ET the Dow Jones Industrial Average was up 416.22 points, or 1.26%, at 33,569.43, the S&P 500 was up 58.10 points, or 1.45%, at 4,077.97 and the Nasdaq Composite was up 184.03 points, or 1.37%, at 13,664.14.
The S&P 1500 airlines index jumped about 4% as the U.S. Centers for Disease Control and Prevention said fully vaccinated people can safely travel at “low risk” after the agency had held off for weeks on revising guidance that discouraged all non-essential trips.
Meanwhile, U.S. Treasury Secretary Janet Yellen said that she is working with G20 countries to agree on a global corporate minimum tax rate to end a “30-year race to the bottom on corporate tax rates.”
Tesla Inc shares surged 5% after the world’s most valuable automaker posted record deliveries.
Advancing issues outnumbered decliners by a 1.79-to-1 ratio on the NYSE and by a 1.26-to-1 ratio on the Nasdaq.
The S&P index recorded 75 new 52-week highs and no new low, while the Nasdaq recorded 140 new highs and eight new lows.
Reporting by Medha Singh in Bengaluru; Editing by Maju Samuel
