U.S. stocks rose on Thursday as expectations of a coronavirus stimulus bill being passed continue to drive up market sentiment.
The Dow Jones Industrial Average traded 150 points higher, or 0.5%. The S&P 500 gained 0.7% and the Nasdaq Composite advanced 0.4%.
Shares of United Airlines climbed 2.9% and American Airlines gained 3.4%. Delta popped nearly 2%.
President Donald Trump said Thursday morning that the administration and Democrats were “starting to have some very productive talks.” His comments came after he urged lawmakers to push through coronavirus aid for airlines, sparking a massive market rally on Wednesday. (Click here for the latest news on the coronavirus.)
The Dow had its best day since mid July on Wednesday, rallying more than 1%. The S&P 500 and Nasdaq were also up more than 1% during the previous session.
“Even though there is uncertainty now about the fiscal stimulus negotiations, regardless of who wins the election, we are likely to have additional fiscal stimulus,” said Nancy Davis, founder and portfolio manager at Quadratic Capital.
“With the uncertainty, I think it’s important for investors to have a diversified portfolio, with investments that are uncorrelated to each other. We should expect more uncertainty going forward,” she added.
With Wednesday’s gains, stocks clawed back Tuesday’s losses and then some. Stocks fell late in the day on Tuesday after Trump said that he told his administration to end coronavirus stimulus talks with Democrats until after the election.
Investors also digested the latest U.S. weekly jobless claims data, which showed an additional 840,000 Americans filed for unemployment benefits for the first time. Economists polled by Dow Jones expected first-time claims for unemployment insurance to total 825,000 for the week ending Oct. 3.
All of the major averages are higher for October, clawing back some of September’s losses, which was the first negative month since March.
Still, a host of risks remain in the market, including rising Covid-19 cases around the world, as well as a slowdown in the rate of the economic recovery.
“The risks we are now facing–medical, economic, and political–have waxed and waned over the year, so a difficult quarter will be nothing new,” noted Brad McMillan, Chief Investment Officer for Commonwealth Financial Network. “In fact, after the election, there is a good chance next year will look much better. We will have to wait and see, but for the moment, be prepared for volatility — but remember that it will pass,” he added.
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U.S. stocks rose on Thursday as expectations of a coronavirus stimulus bill being passed continue to drive up market sentiment.