(Reuters) – U.S. stocks jumped on Thursday as an upbeat outlook from PayPal and a surprise rise in Chinese exports raised hopes of a faster economic recovery from what is expected to be a deep coronavirus-led recession.
FILE PHOTO: The New York Stock Exchange (NYSE) is seen in the financial district of lower Manhattan during the outbreak of the coronavirus disease (COVID-19) in New York City, U.S., April 26, 2020. REUTERS/Jeenah Moon
The payments processor rose 13.3%, providing the biggest boost to the S&P 500 after it forecast a strong recovery in payments volumes in the second quarter as social distancing drives more people to shop online.
Its shares helped the technology index rise 1.7%, while larger peer Visa Inc gained 3.2%.
Lyft Inc surged 23.1% as the ride-hailing company posted higher-than-expected revenue and vowed to further cut costs to be profitable. Rival Uber Technologies, which is expected to report results after markets close, gained 7%.
“With expectations just set so low, any positive news is really being welcomed, and the continuing negative news, to some extent, is being pushed to the side,” said Rick Meckler a partner at Cherry Lane Investments in New Vernon, New Jersey.
U.S. stock indexes have rebounded sharply from the coronavirus-fueled selloff in March, powered by monetary and fiscal stimulus and, more recently, by hard-hit states reopening businesses following sweeping lockdowns.
Wall Street’s fear gauge eased to levels it was trading at in early March, before volatility leapt to 12-year highs due to the COVID-19 pandemic. However, the S&P 500 is still about 15% below its Feb. record high.
Latest data showed 3.17 million Americans applied for state unemployment benefits last week, but the number marked the fifth straight weekly decline in applications. The more comprehensive nonfarm payroll report is due on Friday.
“Some of the revenue and earnings numbers are better-than-expected and for the time being, that immediate focus is driving good bid on the market,” said Tony Caxide, chief investment officer at Hamilton Capital in Columbus, Ohio.
Energy stocks rose 3.7%, the most among 11 major sectors, on optimism around future oil demand after China’s overseas shipments in April rose for the first time this year as factories raced to make up for lost sales.
At 11:20 a.m. ET, the Dow Jones Industrial Average was up 325.75 points, or 1.38%, at 23,990.39, the S&P 500 was up 41.38 points, or 1.45%, at 2,889.80. The Nasdaq Composite was up 116.44 points, or 1.32%, at 8,970.83.
Weapons maker Raytheon Technologies Corp rose 0.7%, as Chief Financial Officer Toby O’Brien said he expected positive free cash flow in 2020, primarily driven by its defense business.
Advancing issues outnumbered decliners by a 4.34-to-1 ratio on the NYSE and by a 2.70-to-1 ratio on the Nasdaq.
The S&P index recorded seven new 52-week highs and no new low, while the Nasdaq recorded 48 new highs and five new lows.
Reporting by C Nivedita and Medha Singh in Bengaluru; Editing by Sagarika Jaisinghani, Bernard Orr and Arun Koyyur