U.S. stock indexes jumped more than 1.5% on Tuesday with Amazon and Google-parent Alphabet set to wrap up results from the so-called FAANG group of stocks, while signs on progress on a large fiscal pandemic relief package also lifted the mood.
Alphabet, which will report the cost and operating profit of its Google Cloud business for the first time, added 1.5%, while retail behemoth Amazon.com Inc rose 1.4%.
Shares of both the companies, set to report their fourth-quarter earnings after market close, were among the top boosts to the S&P 500. The NYSE FANG+TM index firmed 1.4%.
“There’s no reason to think that the strength of earnings on the part of big tech is likely to diminish until perhaps later in the year and certainly the fourth quarter was likely to be a good one,” said Julian Emanuel, chief equity and derivatives strategist at BTIG.
Meanwhile, the Democratic-led U.S. House of Representatives prepared to take the first step forward on President Joe Biden’s $1.9 trillion COVID-19 relief package on Tuesday, with a key vote expected to fast-track the measure through Congress.
At 11:39 a.m. ET, the Dow Jones Industrial Average rose 600.37 points, or 1.99%, to 30,812.28, the S&P 500 gained 65.25 points, or 1.73%, to 3,839.11 and the Nasdaq Composite gained 190.34 points, or 1.42%, to 13,593.73.
All the 11 major S&P sectors advanced, with economy-linked energy, financial and industrials gaining the most.
New cases of COVID-19 in the United States fell for a third week in a row, the first time since last September.
The number of people who have received the first dose of a COVID-19 vaccine is fast closing in the total infections across the country, according to U.S. CDC data as of Feb. 1.
“Investors are going back to the script of strong earnings growth … and expectations of an economic reopening, as the vaccine get more widely distributed and all of those point to the continuation of the markets upward trend,” said Emanuel.
Wall Street’s fear gauge retreated to near one-week lows as a retail-driven mania for shorted assets showed signs of fizzling out.
GameStop Corp tumbled about 40%, falling sharply for the second day, while miners Hecla Mining Co and Coeur Mining Inc also tracked a drop in spot silver prices.
Exxon Mobil Corp posted its first annual loss as a public company. However, its shares rose about 4% as its quarterly adjusted profit topped estimates. Exxon’s shares, as well as a jump in oil prices lifted the energy sector by about 3%.
United Parcel Service Inc gained 2.4% after it beat quarterly profit estimates on a surge in home delivery volume due to pandemic-fueled online purchases of holiday gifts and staples.
Advancing issues outnumbered decliners by a 3.8-to-1 ratio on the NYSE and by a 2.5-to-1 ratio on the Nasdaq.
The S&P 500 posted 16 new 52-week highs and no new low, while the Nasdaq recorded 164 new highs and nine new lows.
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