Stock market live Wednesday: S&P 500 jumps 1.3%, first 4-day win streak since Feb., Zoom Video up 7%

The market built on its rally on Wednesday on signs of a economic recovery amid states reopening. Investors piled into cyclical stocks like banks and retailers, while continuing to rotate out of megacap tech. The S&P 500 rose for a fourth straight day, trimming its year-to-date loss to just 3.3%. Here’s what happened:

• Dow closed up 2.05% for its third straight positive day
• Dow is down 7.95% this year on pace for its worst year since 2008 when the Dow lost 33.64%
• Dow is 11.16% below its intraday all-time high of 29,568.57 from Feb. 12
• Dow is 44.23% above its 52-week low of 18,213.65 on March 23
• The S&P 500 closed up 1.36% for its fourth straight positive day for the first time since Feb. 6
• The S&P 500 is 7.98% below its intraday all-time high of 3,393.52 from Feb. 19
• The Nasdaq Composite closed up 0.78% for its fourth straight positive day
• The Nasdaq Composite is up 7.92% this year
• The Nasdaq Composite is 1.58% from its intraday all-time high of 9,838.37 from Feb. 19
• 10 out of 11 sectors were positive led by industrials, up 3.91% with Boeing up 12.95% for its best day since April 17 — Francolla

The rally gained steam on Wednesday with the Dow jumping more than 500 points amid the reopening of the economy. Boeing was the biggest gainer in the 30-stock Dow, and big banks also led the rally. The S&P 500 popped 1.3%, while the Nasdaq Composite rose 0.7%. —Li

The small-cap index Russell 2000 gained 2.8% on Wednesday, rising 50.7% from its 52-week low on March 18. Small caps have rebounded sharply in recent days on reopening optimism. -Li

The Nasdaq-100 index, which tracks the 100-largest nonfinancial companies in the Nasdaq Composite, rose 0.6% Wednesday, on track to post a new closing high. It would be the first major index to completely wipe out the pandemic losses. Minutes before the closing bell, the Nasdaq 100 was trading just 0.2% below all-time high reached on Feb. 19. The gains on Wednesday were led by United Airlines, Microchip, and Zoom Video. –Li

The Dow was on pace to post its third straight day of gains, rallying nearly 500 points, as traders bet the worst from the economic downturn has passed. The S&P 500 jumped more than 1% while the Nasdaq Composite gained 0.9%. The Nasdaq 100, which is made up of the 100-largest nonfinancial companies in the composite, was within striking distance of a record high. —Imbert

ZoomInfo is targeting its IPO price at $21 a share, $1 above its already-buoyed price range, two sources familiar with the matter told CNBC. The company disclosed in a government filing on Tuesday that it expected its IPO to price between $19 and $20 per share, higher than the initial range of $16 to $18 a share. ZoomInfo, which provides data to corporations for customer outreach, will trade under the symbol “ZI.” –Franck, Li

A Federal Reserve initiative to buy municipal bonds is being expanded. The Fed said Wednesday that all states now can designate at least two cities or counties that can directly use the Municipal Liquidity Facility. In addition, the central bank said governors now can designate as participants two issuers that get revenues from activities such as public transport, airports, toll facilities, utilities and other government activities. The initial rules of the program restricted borrowing to counties with populations of at least 500,000 residents and cities with populations of at least 250,000. -Cox

Shares of Pilgrim’s Pride plummeted to trade more than 13% lower after the company’s CEO, along with other industry executives, were indicted for price fixing. “Executives who cheat American consumers, restauranteurs, and grocers, and compromise the integrity of our food supply, will be held responsible for their actions,” said Assistant Attorney General Makan Delrahim. Those indictments were unsealed in a Colorado federal court. –Imbert

Data compiled by Instinet showed that 98% of all S&P 500 stocks were trading above their 50-day moving average as expectations for the economic reopening fueled the market’s rally from its late-March lows. Frank Cappelleri, executive director at Instinet, pointed out this is bullish for the market long term, but added it could signal the market is “stretched short term.” —Imbert

Around midday, the major averages were sharply higher following the release of economic data that were better than expected. The Dow was up by 417 points, or 1.6% while the S&P 500 gained 1.2% to trade above 3,100 for the first time since March. Data from ADP and Moody’s Analytics showed private payrolls decreased much less than feared while the ISM nonmanufacturing index jumped from an 11-year trough. —Imbert

A faster than expected housing recovery will leader to greater gains in shares of Home Depot and Lowe’s after the coronavirus passes Oppenheimer said in a note to clients on Wednesday. “While current, historically strong top-line expansion at the chains will eventually moderate, we are increasingly optimistic that the combination of a sustained shift in consumer spending towards home-related goods and a potentially quicker-than-initially-anticipated recovery in the broader housing market has the potential to keep comp growth at HD and LOW healthily above pre-COVID-19 levels for some time and should encourage investors to award shares with multiples at the upper-end of historical parameters,” analyst Brian Nagel said. Lowe’s shares are up 27% over the last month while shares of Home Depot are up 15%.– Bloom

The S&P 500 has jumped nearly 40% over the last 50 trading days, making it the largest 50-day rally on record, according to LPL Financial. Looking at the other largest 50-day rallies, the firm found that in every instance stocks were higher six and twelve months later. A number of factors have contributed to the benchmark index’s surge from its March 23 low, including record stimulus measures from the government and Federal Reserve, as well as states beginning to reopen their economies as the number of coronavirus cases slows. – Stevens

First Trust Dow Jones Internet ETF (FDN) and iShares Expanded Tech-Software ETF (IGV) hit new intraday all-time highs Wednesday since their inception date in 2006 and 2001. The gains in IGV were led by Cloudera, Alarm.com, Trade Desk and Zoom Video. Cloudera was up 6%, on pace for its best day since May 20 and its 12 positive day in the last 13. Zoom Video climbed 5.5%, on pace for its fifth straight positive day. As of early Wednesday, trading in Zoom has already surpassed its 30-day average volume of 12.8 million shares, trading over 14 million shares so far. – Francolla, Li

Restaurant company Cheesecake Factory looks set to benefit from the economy re-opening according to Wells Fargo. “We believe CAKE is set to thrive in a post- COVID environment as the company’s major source of traffic pressure (competitive restaurant development within malls) materially slows,” analyst Jon Tower said. In addition to being up 15% in early trading, the stock is also up 20% over the last month. – Bloom

The Institute for Supply Management (ISM) said its non-manufacturing activity index rose to a reading of 45.4 last month from 41.8 in April. Economists polled by Dow Jones were expecting a reading of 44.4 in May. The April figure marked the first contraction in the U.S. services sector since December 2009 as the coronavirus pandemic roiled the economy. –Li

Investors continued to dump tech and internet companies that had led the market comeback previously. Shares of Netflix dipped more than 1%, while Facebook was down 0.9%. Amazon, Apple, Microsoft and Alphabet were all in the red in morning trading. These stocks were popular stay-at-home plays amid the pandemic over the past two months, but with positive signs of a successful economic reopening, investors started to rotate out of these names and into economically sensitive sectors. Banks, airlines and hotels, whose profitability is directly linked to the reopening, outperformed again on Wednesday. -Li

Stocks opened higher with the Dow Jones Industrial Average rising 230 points, on pace for a third straight day of gains. The S&P 500 climbed 0.7%, while the Nasdaq Composite 0.4%. The Nasdaq 100 index rebounded sharply from its March bottom, now sitting less than 1% from its record high. — Li

Health care equity research firm SVB Leerink upgraded biotech Gilead Sciences to outperform from market perform on Wednesday. “Our upgrade is based on the inclusion of our first revenue and profit contribution for remdesivir, and also incorporation of the product opportunities from the recently announced Arcus collaboration,” the firm said. Gilead said last month it has struck a licensing agreement with five generic drugmakers to make antiviral drug remdesivir for 127 countries. Preliminary clinical trials have shown effectiveness in treating Covid-19 patients. Shares of Gilead gained more than 1% in premarket trading on Wednesday. The stock has gained nearly 13% this year. –Li

• RBC upgraded Zoom to outperform from sector perform.
• Jefferies upgraded Mattel to buy from hold.
• Morgan Stanley raised its price target on Apple to $340 from $326.
• Piper Sandler upgraded Kontoor Brands to overweight from neutral.
• Cowen initiated Deckers as outperform.
• Morgan Stanley downgraded Norwegian Cruise to underweight from equal weight and reinstated Carnival and Royal Caribbean as underweight.
• Leerink upgraded Gilead to outperform from market perform.

Pro Subscribers can read more here. — Bloom

Private sector jobs fell 2.76 million last month, according to a report Wednesday from ADP. The number was far less than the 8.75 million estimate. The reason for the wide disparity was not immediately clear. — Li

Warner Music will make its debut as a public company on Wednesday when it conducts its initial public offering from the Nasdaq during regular trading and begins trading under the symbol “WMG”. Warner, the globe’s third-largest music label and the largest IPO this year, announced Wednesday morning that it’s priced its offering of 77 million Class A stock at $25 per share. The company, which represents performers including Ed Sheeran, Cardi B and Lizzo, will be entirely controlled by Len Blavatnik’s Access Industries, which will own more than 99% of Warner’s voting power after the public offering. — Franck

Mass gatherings continued across the country Tuesday night to protest against police brutality after the death of an unarmed black man George Floyd, but protests were noticeably calmer than they have been in recent days. New York City instituted an earlier curfew and ramped up law enforcement, but it didn’t stop thousands of people from demonstrating throughout the city overnight, AP reported. Washington also ordered people off streets before sundown, while protests continued well past the 7 p.m. curfew near the White House, NBC reported. Peaceful protests were also seen in Los Angeles, Miami, St. Paul, Minnesota, South Carolina and Houston, AP said, adding there were less violent activities in some cities where fires and looting had been prevalent in the days prior. -Li

Mortgage applications to purchase a home rose a stunning 18% from a year ago, the Mortgage Bankers Association said Wednesday. The rate was up 5% for the week. Homebuyers are flooding the market as they try to snatch up what few homes there are for sale. “The pent-up demand from homebuyers returning to the market continues to support a recovery from the weekly declines observed earlier this spring,” said Joel Kan, an MBA economist. “However, there are still many households affected by the widespread job losses and current economic downturn. High unemployment and low housing supply may restrain a more meaningful rebound in purchase applications in the coming months.” A record-low 30-year fixed mortgage rate of 3.37% also fueled the trend. – Fitzgerald, Olick

Shares of Zoom Video gained more than 1% during Wednesday’s premarket trading after the company said revenue grew 169% during the first quarter as people flocked to the company’s videoconferencing software amid the pandemic. The company earned an adjusted 20 cents per share for the quarter, which was ahead of Street estimates of 9 cents, according to estimates from Refinitiv. Revenue for the quarter, which ended on April 30, came in at $328.2 million, and the company doubled its revenue guidance for the year. Shares are up 205% this year. – Stevens

The Nasdaq-100 index entered Wednesday trading less than 1% from an all-time high reached on Feb. 19. The index — which is made up of the 100-largest nonfinancial companies in the Nasdaq Composite — has rallied more than 41% since hitting an intraday low on March 23. Those gains have been largely driven by strong performances from stocks such as Netflix, Amazon and Zoom Video. All three of those stocks benefited from people staying at home due to the coronavirus pandemic. The Nasdaq-100 is the benchmark for the popular QQQs fund. —Imbert

Stock futures climbed in morning trading Wednesday, pointing to a higher open after two straight days of gains this week. Investors clung to optimism for a smooth economic reopening as more coronavirus restrictions started to ease. Futures on the Dow Jones Industrial Average rose about 150 points, while the S&P 500 futures gained 0.4%. Nasdaq 100 futures climbed about 0.3%. — Li

CNBC’s Gina Francolla, Thomas Franck, Michael Bloom, Maggie Fitzgerald and Diana Olick contributed reporting.

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