Stocks climb more than 2% as investors get back to buying

Monday, March 1, 2021 | Damian J. Troise And Alex Veiga, AP Business Writers


American flags hang outside of the New York Stock Exchange, in this Tuesday, Feb. 16, 2021, file photo. Stocks are higher across the board in early trading on Wall Street as bond yields ease lower following several weeks of shooting higher. Traders were also watching Washington as a big economic stimulus bill moved to the Senate. The S&P 500 was up 1.5% in the early going Monday, March 1, 2021. (AP Photo/Frank Franklin II, File)

Stocks are rising across the board on Wall Street Monday, on pace for the market's best day in nearly nine months as traders welcome a move lower in long-term interest rates as a recent surge in U.S. bond yields eases. Investors are also watching Washington as a big economic stimulus bill advanced to the Senate.

The S&P 500 climbed 2.5% as of 3:19 p.m. Eastern., clawing back most of its losses from last week and on track for its best day since June 5.

More than 95% of the stocks in the benchmark index were higher, with technology, financial and industrial companies among those driving the rally. The Dow Jones Industrial Average was up 665 points, or 2.2%, to 31,600 and the Nasdaq Composite rose 3%.

Smaller company stocks continued to outgain the broader market, a sign that investors are feeling more confident about the economy's prospects for growth. The Russell 2000 index was up 3.6%.

Much of the focus on Wall Street is on the bond market, where Treasury yields were headed lower. The yield on the 10-year Treasury note fell to 1.45% after going as high as 1.5% last week, the highest level in more than a year. Higher interest rates can slow the economy and discourage borrowing, so Wall Street gets jittery when there's a big surge in rates.

“It moved really fast, the interest rate rise, and now it’s sort of leveling out so people are relieved that it’s not continuing to move up at a really fast pace,” said Tom Martin, senior portfolio manager with Globalt Investments.

Bond yields, which influence interest rates on mortgages and many other kinds of loans, have been steadily climbing much of the year, as investors have bet that vaccination efforts and more government stimulus will lead to strong economic growth this year. However, along with strong economic growth comes concerns of inflation.

A handful high-level officials with the Federal Reserve will make speeches this week, which will give investors additional information on how concerned the nation's central bank is about the economy and inflation. Lael Brainard, an advocate for looser monetary policies, will give a monetary policy speech on Tuesday and Fed Chair Jerome Powell will give a speech on Thursday.

The House of Representatives approved Biden’s $1.9 trillion pandemic relief bill on Friday and it now goes to the Senate for approval. The bill infuses cash across the struggling economy to individuals, businesses, schools, states and cities battered by COVID-19.

The stimulus bill would include yet another round of one-time payments to most Americans, including an expansion of other refundable tax credits like the child tax credit, and additional aid to state and local governments to combat the pandemic.

Johnson & Johnson rose 0.7% after the Food and Drug Administration gave approval for the company's own coronavirus vaccine, one that does not require extensive refrigeration like the ones made by Moderna and Pfizer.

Technology and financial companies made some of the biggest gains. Apple surged 5% and Citigroup rose 6.1%. Companies that rely on consumer spending also fared well. Etsy jumped 11.6% and cosmetics retailer Ulta Beauty gained 5.1%.

Industrial companies, including airlines beaten down by the virus pandemic, also helped boost the broader market. American Airlines rose 1.1%.

Investors will get several big economic reports this week, including February's jobs report on Friday. On Monday a report on manufacturing came in better than expectations, and new orders also came in better than expected.



7 Stocks to Buy For the Current Housing Boom

It’s been an uneven economic recovery to date. However, one area that is unquestionably booming is the housing market. But the interesting thing is that it took more than low mortgage rates to convince home buyers to take the plunge.

What it took was a pandemic. Think I’m kidding? Look at the Housing Market Index (HMI). In September, the HMI posted a preliminary rating of 83. That’s a historical high. And this marks the fifth consecutive month the HMI has increased.

Simply put, Americans have a renewed interest in spreading out. For some urban apartment dwellers, this means a flight to a place of their own. Some that own homes in more densely populated areas are looking for more wide-open spaces.

And regardless of the outcome of the presidential election, the Federal Reserve has indicated it is in no hurry to raise interest rates. This means that mortgage rates should remain favorable no matter which party occupies the White House.

There are many ways for investors to profit from this housing boom. Homebuilder stocks are a logical choice. But other companies will benefit from the rise in homeownership.

To help you capitalize on this red hot sector, we’ve put together this special presentation.

View the "7 Stocks to Buy For the Current Housing Boom".


Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
Pfizer (PFE)2.4$36.60flat4.26%23.61Hold$38.57
Johnson & Johnson (JNJ)2.7$161.25flat2.51%25.35Buy$180.64
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