Stocks closed higher again on Wall Street on Monday, led by health care stocks, bringing the market’s surge over the past week to 17%.
The S&P 500 rose more than 3% for its fourth gain in five days, following up its best weekly gain since hitting bottom after the financial crisis 11 years ago.
The Dow Jones industrial average gained 690 points, or 3.2%, and the NASDAQ jumped 3.6%.
Trading remained tentative amid uncertainty about whether global authorities can nurse the economy through the severe damage being wrought by the coronavirus pandemic. The S&P 500 remains 22% below the record high set last month, and oil tumbled to an 18-year low.
Stocks were led by big gains for health care companies announcing developments that could aid in the coronavirus outbreak.
The rally tacked more gains onto a recent upswing for the market, which is coming off the best week for the S&P 500 since hitting bottom after the financial crisis 11 years ago. Nascent optimism is budding on Wall Street that the worst of the selling may be over, but markets around the world remain tentative amid uncertainty about whether global authorities can nurse the economy through the pandemic. The S&P 500 remains about 23% below its record set last month, and oil tumbled to an 18-year low.
A surge for health care stocks led the way at the week’s open. Abbott Laboratories jumped 6% after saying it has a test that can detect the new coronavirus in as little as five minutes. Johnson & Johnson leaped 7.1% after it said it expects to begin human clinical studies on a vaccine candidate for COVID-19 by September.
Stocks jumped last week as the Federal Reserve promised to buy as many Treasurys as it takes to get lending markets running smoothly and Capitol Hill agreed on a $2.2 trillion rescue package for the economy. .
“The market wants to see everything line up, and last week everything lined up,” said Nela Richardson, investment strategist at Edward Jones, referring to the unprecedented aid from the Fed and Congress.
Now, she said, President Donald Trump also appears to be in sync with health experts about the need to restrict the economy to slow the spread of the virus. Trump on Sunday extended social-distancing guidelines, which recommend against group gatherings larger than 10, through the end of April after earlier saying he wanted the economy open by Easter.
“Now that message is in line,” said Richardson. “All these things line up coming into this week, and that’s why you saw strong performance last week continuing today.”
Some of Monday’s sharpest action was in the oil market, where benchmark U.S. crude fell 6.6% to close at $20.09 a barrel. Earlier, it dipped below $20 for the first time since early 2002. Oil started the year above $60, and prices have plunged on expectations that a weakened global economy will burn less fuel. The world is awash in oil, meanwhile, as producers continue to pull more of it out of the ground. Brent crude, the international standard, fell 8.7% to $22.76 a barrel.