NEW YORK: Wall Street indexes opened a touch higher on Monday after President Donald Trump signed executive orders over the weekend to support the country’s economy through the coronavirus crisis until more concrete stimulus could be passed.
The S&P 500 traded about a percent below a record high, while the Nasdaq hovered below a lifetime high after a series of new peaks last week.
Trump’s orders, that partly restored enhanced unemployment benefits, came after talks between the White House and top Democrats in Congress about fresh stimulus broke down.
US Treasury Secretary Steven Mnuchin, in an interview to CNBC on Monday, said the Trump administration and Congress could reach an agreement as soon as this week if Democrats are “reasonable.”
Tensions between Washington and Beijing were also at play, after Trump signed executive orders last week banning major Chinese technology firms in 45 days’ time while announcing sanctions on 11 Chinese and Hong Kong officials.
Still, optimism over a better-than-expected earnings season and hopes of more stimulus saw the S&P 500 extend gains into a seventh straight session, while the Nasdaq scaled a record high every day of last week.
After a strong tech-led rally over the past few months, “to me it’s about the US stimulus as a catalyst for markets at this point,” said Tim Chubb, chief investment officer at Girard in West Chester, Pennsylvania.
“I wouldn’t we surprised if the markets were to close off a little bit here and we start to see some unwinding in the favorites.”
Seven of the 11 major S&P sectors traded higher, with energy leading gains. Health care, real estate and utilities underperformed.
Among individual movers, Eastman Kodak Co. plunged 37.5 percent after its $765-million loan agreement with the US government to produce pharmaceutical ingredients was put on hold due to “recent allegations of wrongdoing.” Trading in its shares was halted briefly due to volatility.
The No. 1 US mall owner Simon Property Group rose 4 percent after a report that it has been in talks with Amazon.com Inc. about turning some of its department-store sites into Amazon fulfillment centers.
Berkshire Hathaway Inc. shares edged higher as its second-quarter net income surged 87 percent.
Advancing issues outnumbered decliners by a 2.91-to-1 ratio on the NYSE and by a 1.74-to-1 ratio on the Nasdaq.
The S&P index recorded 18 new 52-week highs and no new low, while the Nasdaq recorded 51 new highs and two new lows.