Global stocks rose Friday, with U.S. futures pointing to a fourth week of gains in five weeks, as central banks’ stimulus measures and investors’ optimism about the pace of economic recovery fuel a cautious rally in equities.
Futures tied to the Dow Jones Industrial Average gained 1.4%, suggesting that the blue-chips index will advance after the New York opening bell. The Dow edged down 0.2% Thursday, even as the S&P 500 index ticked higher.
Elsewhere, the pan-continental Stoxx Europe 600 climbed 0.8%, led higher by French and U.K. stocks. Most major Asian markets closed higher.
Fears that a second wave of infections may trigger fresh restrictions on social and business activity led to a sharp decline in stocks last week. Those concerns have been tempered in recent days by a string of economic data suggesting that the U.S. economy is recovering, with retail sales rebounding and jobless claims easing.
“The things you saw in March—the panic and forced selling—all seems to have faded, so it’s a bit more of a normal market, though a fragile one,” said Jonas Golterman, senior markets economist at Capital Economics. “The ingrained reflex which we have had in the past 10 years is, we have to buy the dip, and that usually works out."
Early coronavirus testing data from U.S. states and cities, including Minnesota, where the police killing of George Floyd sparked global protests, suggest recent mass gatherings haven't led to a marked uptick in new cases.
While the number of new cases in Florida, Arizona and California have hit daily record highs, authorities so far have shown no signs of putting lockdown-measures back in place. Authorities in California are instead requiring residents to wear face masks in high-risk settings. Investors have cheered signs that the U.S. economy is reopening, allowing people to return to work and business activity to pick up.
“At the moment, people just seemed very focused on the strength of the recovery, which is to be expected given the strength of the shutdown,” said Lyn Graham-Taylor, fixed-income strategist at Rabobank. “Through the summer, the economic data will be mechanically good just because it’s going off such a low base, so it will take time to find out what the economic scarring is.”
Among the biggest movers ahead of the opening bell in New York, shares in Marathon Petroleum gained 9.2% in premarket trading after The Wall Street Journal reported the company is in discussions with potential buyers of its Speedway gas-station unit.
Shares in AMC Entertainment rallied 10.5% before the bell on plans to reopen most of its movie theaters in July.
In Asia, the Shanghai Composite rallied almost 1% by the close of trading. South Korea’s Kospi Composite gained 0.4% and Hong Kong’s Hang Seng Index rose 0.7%.
The yield on the 10-year Treasury note ticked up to 0.731%, up from 0.693% on Thursday.
In commodities, Brent crude, the global oil benchmark, gained 2.3% to $42.48 a barrel. Investors have grown more optimistic about the prospects for energy markets after the Organization of the Petroleum Exporting Countries reported that nations had been complying to a high degree with recent production-cut agreements.
U.S. stocks are on track for a fourth week of gains in five weeks.
Photo: Michael Nagle/Bloomberg NewsWrite to Avantika Chilkoti at Avantika.Chilkoti@wsj.com
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June 19, 2020 at 08:30PM
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U.S. Stocks Open Higher, Set for Weekly Gains - The Wall Street Journal
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