US Stock Market Overview – Stocks Rally on Moderna News as Sentiment Turns Positive

US stocks surged on Monday, initially driven by positive sentiment from an interview that Fed Chair Powell gave with 60-minutes. The Fed chair said that he would not be against the US economy and he could see a robust rebound coming in 2021 if there was no spike in COVID cases. Futures were positive in the overnight session but surged even higher following a report from Moderna that said it observed 8-cases where people who took the virus created antibodies that were similar to the antibodies that people who had COVID attained. The news set Moderna (MRNA) up 26% at its highs and generated positive sentiment for the rest of the market.

Oil prices also surged higher on Monday, as news that gasoline demand across states that have reopened surged. This helped buoy the energy sectors which was the best performer in the S&P 500 index. All sectors in the S&P 500 were high, led by energy and real estate, consumer staples was the worst-performing sector in the large-cap index. Homebuilder sentiment rebounded slightly in May after tumbling in April.

Homebuilder Sentiment Rebounds

Homebuilder sentiment bounced back in May. Confidence in the market for single-family, newly built homes rose 7 points in May to 37, according to the National Association of Home Builders Housing Market Index. The index stood at 66 in May 2019 and hit a recent high of 76 in December. Sentiment plunged an unprecedented 42 points in April, as the coronavirus pandemic shut down much of the economy. Now, buyers appear to be shopping again in person and virtually.

China Bashing Continues

President Trump is very good at speaking when he has a foil. Unfortunately, the virus does not create an enemy that he is good at targeting. He has turned his attention back to China, which continued over the weekend. The Trump administration imposed additional measures to restrict access to Chinese tech companies, especially Huawei, by restricting the use of US equipment without a license. Of course, Beijing is already planning retaliation.