U.S. stocks rose on Wednesday as shares tied to the economic reopening supported the broader market once again.
The Dow Jones Industrial Average rose 79 points, while the S&P 500 gained 0.3%. The tech-heavy Nasdaq Composite added 0.3%. The S&P 500 sits just about 1.1% from a record with the major benchmark little changed for the month of May.
Shares of companies linked to a recovering economy gained. Carnival Corp rose about 1%. Bank of America shares were also higher. Royal Caribbean jumped 2% and brought its gain this week to 11% after the cruise line operator received approval to begin test cruises with volunteer passengers.
The optimism on the economycomes as U.S. average daily Covid cases fall below 25,000 and as nearly half the U.S. population has received at least one vaccination dose.
Shares of Ford rose more than 2% after the automobile giant said it is increasing its investment in electric vehicles by $30 billion through 2025.
Bitcoin continued its comeback, helping risk sentiment in the financial markets. Bitcoin climbed back above $40,000 on Wednesday, according to Coin Metrics. On May 19th, the cryptocurrency hit a low of 30,001.51 following an intraday crash of 30%. Shares of Tesla, a big holder of bitcoin, added 0.5% in premarket trading. Coinbase shares were also higher.
Investors will be keeping an eye on Washington and any developments on an infrastructure compromise that could boost the economy further. Senate Republicansplan to send President Joe Biden a counteroffer this weekcosts nearly $1 trillion.
Nordstromshares dropped about 6% in extended trading after the company missed the Street'sfirst-quarter earningsexpectations, while shares ofUrban Outfittersjumped more than 7% following better-than-expected quarterly results after the bell.
The market struggled to find direction Tuesday. Stocks edged higher early in the session, but ultimately closed lower. The S&P 500 dipped 0.2% as the energy sector lagged. The Nasdaq Composite closed flat while the Dow Jones Industrial Average dipped 81.52 points, or 0.2%.
Airline, cruise line and homebuilder stocks outperformed on Tuesday.United Airlinesjumped 1.5% after the carrier said domestic leisure fairstopped 2019 levels this month amid the reopening.Royal CaribbeanandNorwegian Cruise Lineshares each rose about 3.6%.NVRshares jumped about 4%.
The strong performance from reopening stocks suggests "investors are also leaning into the normalcy," Goldman Sachs managing director Chris Hussey wrote in a note. "The news on the recovery remains very encouraging in the US. And it's interesting to see that some stocks may have still not fully priced it in."
"Low volatility, flat equities, declining US Treasury yields, and low trading volumes — feels a lot like a Tuesday during a pre-holiday week. In other words, this feels...normal," Hussey said.
Investors are awaiting a speech from Federal Reserve Vice Chair Randal Quarles on Wednesday as concerns surrounding inflation and potential tapering of asset purchases continue.
Chief executives of the country's largest banks — includingJPMorgan Chase,Bank of America,Citigroup,Wells Fargo,Goldman SachsandMorgan Stanley— are set to testify before the Senate Banking Committee on Wednesday morning.
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