Wall Street’s indexes have climbed following a clutch of upbeat earnings reports led by PayPal as investors looked past more weak jobs data caused by the coronavirus-induced economic downturn.
Energy, materials and financials, which have lagged this year, led the way among S&P 500 sectors.
Shares of PayPal Holdings soared and boosted the S&P 500 and the Nasdaq after the company said it expects a strong recovery in payments volumes in the second quarter as social distancing drives more people to shop online.
Shares of media company ViacomCBS Inc and ride-hailing firm Lyft also jumped after their earnings, as a first-quarter reporting season that Refinitiv estimates will show a 12 per cent decline in earnings begins to wind down.
Stocks have rebounded sharply since late March from the coronavirus-fuelled sell-off, helped by massive monetary and fiscal stimulus. Investors are now watching efforts by a number of states to spark their economies by easing restrictions put in place to fight the outbreak.
“Everything is going smoothly so far and I think there’s an assumption on the market’s part that that’s a good sign,” said Brad McMillan, chief investment officer for Commonwealth Financial Network. “The market is looking at this and saying so far, so good.”
Unofficially, the Dow Jones Industrial Average rose 211.25 points, or 0.89 per cent, to 23,875.89, the S&P 500 gained 32.77 points, or 1.15 per cent, to 2,881.19 and the Nasdaq Composite added 125.27 points, or 1.41 per cent, to 8,979.66.
US data showed millions more people sought unemployment benefits last week, suggesting lay-offs broadened from consumer-facing industries to other segments of the economy and could remain elevated even as many parts of the country start to reopen.
The US employment report for April is due on Friday.
“The market rightly or wrongly is just much more focused on what that data looks like two months from now, not what that data looks like right now,” said Eric Freedman, chief investment officer at U.S. Bank Wealth Management.
Investors were also encouraged by news that China’s exports unexpectedly rose in April for the first time this year as factories raced to make up for lost sales due to the coronavirus pandemic.