Monday, May 27, 2024

Stocks drift on Wall Street; S&P 500 within 1% of record

by Associated Press

NEW YORK (AP) — Wall Street is drifting in early trading on Monday after President Donald Trump announced several stopgap moves to aid the economy, following the collapse of talks in Congress for a bigger rescue package.

The S&P 500 was up 0.1% after Trump signed executive orders over the weekend to extend an expired benefit for unemployed workers, among other things, though they were more limited than what investors hoped to see from a full rescue bill for the economy. Both the White House and congressional Democrats indicated Sunday they wanted to resume negotiations, but no talks were scheduled.

The Dow Jones Industrial Average was up 216 points, or 0.8% at 27,650, as of 10:03 a.m. Eastern time, and the Nasdaq composite was down 0.4%.

If stocks end the day higher, it would extend the S&P 500’s wining streak to seven days, which would be its longest since the spring of 2019. The S&P 500 has rallied all the way back to within 0.9% of its record, which was set before the pandemic pancaked the economy into recession. It had been down nearly 34% in March.

Investors have been saying the economy needs another big lifeline from Washington, and quickly, after $600 in weekly unemployment benefits for workers from the federal government expired at the end of July. But talks broke apart on Friday, and Trump issued his executive orders on Saturday.

Almost immediately afterward, critics said the moves did not go far enough to support the economy and may not be able to be implemented anyway. The economy has shown some signs of improvement since the spring, but it is still struggling. Friday’s jobs report showed a larger-than-expected increase in hiring across the economy during July, but also a slowdown in job growth amid worries that a resurgence in coronavirus counts could force the economy to backtrack.

The impasse on Capitol Hill is just one of several big forces pushing on markets, not even including the rising number of coronavirus counts around the world.

Rising toward the top of the list in recent weeks has been growing antagonism between the United States and China, the world’s largest economies. The latest move in their escalating tensions was China’s announcement of unspecified sanctions against 11 U.S. politicians and heads of organizations promoting democratic causes, including Senators Marco Rubio and Ted Cruz.

The two sides are scheduled to hold trade talks later this week.

Chinese stocks rose earlier in the morning, along with many other markets around the world.

Stocks in Shanghai climbed 0.8%, and South Korea’s Kospi added 1.5%. The Hang Seng in Hong Kong, though, dipped 0.6% after the authorities arrested pro-democracy media tycoon Jimmy Lai and some of his associates on suspicion of collusion with foreign powers.

In Europe, Germany’s DAX returned 0.4%, and France’s CAC 40 gained 0.6%. The FTSE 100 in London added 0.6%.

The yield on the 10-year Treasury dipped to 0.55% from 0.56% late Friday.

Benchmark U.S. crude oil gained 2.1% to $42.09 per barrel. Brent crude, the international standard for pricing, added 1.8% to $45.19 per barrel.

Gold added 1.1% to $2,050.60 per ounce.

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