The S&P energy, financials and materials sectors rose on expectations they will benefit from a reopened economy, while heavyweights Apple Inc, Tesla Inc and Microsoft Corp were lower most of the session. All three closed higher in a late market surge.
Value and cyclicals outperform in a rising interest rate, higher-growth environment, which the US economy is on the cusp of entering, said Thomas Hayes, chairman and managing member of hedge fund Great Hill Capital LLC in New York. The Cboe Volatility Index, Wall Street’s so-called fear gauge, closed below 20 for first time since February 2020.
A Reuters poll showed the US economy is expected to reach pre-Covid-19 levels within a year as the proposed US$1.9 trillion fiscal bill helps boost economic activity, but employment will likely take more than a year to fully recover. The Dow Jones Industrial Average rose 27.7 points, or 0.09 per cent, to 31,458.4, the S&P 500 gained 18.45 points, or 0.47 per cent, to 3,934.83 and the Nasdaq Composite added 69.70 points, or 0.5 per cent, to 14,095.47.The small-cap index rose for the fifth week out of six full weeks this year. PayPal Holdings Inc rose 4.7 per cent after several brokerages raised their price targets following the payments company’s investor day call a day earlier.