Stocks bounced back Monday, with the Dow Jones Industrial Average soaring nearly 600 points after a senior Fed official said the central bank isn’t ready to change its stance.
The Dow Jones industrials soared 1.8%, the S&P 500 rallied 1.4% and the Nasdaq rose 0.8% in the stock market today. Small caps tracked by the Russell 2000 outperformed, up 2.1%. Early data showed lower volume on both major exchanges vs. Friday.
Stocks sold off hard on Friday, after St. Louis Fed President James Bullard signaled interest rates could increase in 2022 if inflation picks up. But on Monday, New York Fed president John Williams said the economy still has a ways to go.
“It’s clear that the economy is improving at a rapid rate, and the medium-term outlook is very good,” Williams said in prepared remarks. “But the data and conditions have not progressed enough for the FOMC to shift its monetary policy stance of strong support for the economic recovery.”
U.S. Stock Market Today Overview
Last Update: 4:06 PM ET 6/21/2021
Last year, tech stocks boosted the Nasdaq to a 43.6% gain — its fifth best year ever. The S&P 500 rose 16.3% in 2020, and the Dow added 7.2%. Read The Big Picture for more detailed daily market analysis.
The U.S. economy is recovering from the Covid-19 pandemic, after it triggered nationwide lockdowns over a year ago. Most states have relaxed restrictions as vaccinations continue to roll out and cases decrease.
Cumulative Covid-19 cases worldwide have topped 179 million, with nearly 3.9 million deaths, according to Worldometer. In the U.S., cases have surpassed 34 million with more than 617,000 deaths, although the number of new cases and deaths in the U.S. has slowed dramatically in many states.
As countries race to vaccinate their populace, Moderna (MRNA) rallied 4.5%. Shares are well extended from a 189.10 buy point of a cup with handle, according to IBD MarketSmith chart analysis. The Massachusetts-based biotech announced manufacturing changes that it expects to boost its Covid-19 supply by 50%.
Dow Jones Winners
American Express (AXP) led the blue chip index with a 4.2% jump after testing the 10-week moving average last week. It’s extended from a 150.55 buy point of a cup with handle cleared in late April. But the rebound off the 10-week line sets up a chance to buy or add a smaller number of shares.
Chevron (CVX) gained 2.9% to retake its 50-day line as it shapes a flat base with a 113.21 buy point. Chevron stock is about 6% away from the entry. Oil stocks got a boost Monday, as West Texas intermediate crude prices rose nearly 3% to $73.55 a barrel.
Microsoft stock, up 1.2% Monday, is within striking distance of a 263.29 buy point of a new cup base. It’s about 1% away from the entry. The stock’s relative strength line is close to recent highs, a sign of stock market outperformance.
The software giant plans to announce updates for its Windows operating system on Thursday. Analysts expect Microsoft to unveil Windows 11, the successor to Windows 10, which came out in July 2015.
Apple, which regained its 50-day line last week, rose 1.4% as it continues to trace a new flat base with a 137.17 buy point. Shares are about 4% away from the new entry.
Outside The Dow
Oil and gas, department store and bank stocks led the upside among IBD’s 197 industry groups. Consumer electronics retailers, database software and chip designers were among the few laggards.
Over in the IBD 50, Smith & Wesson (SWBI) shot 18% higher in huge trade to extend Friday’s 17% gain. The gun maker on Friday reported fiscal Q4 earnings and sales that beat Wall Street targets. It also boosted its dividend 60%. Smith & Wesson shares are sharply extended past a 22.60 buy point of a cup with handle.
Follow Nancy Gondo on Twitter at @IBD_NGondo
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