Industrials Push Wall Street Higher as Boeing 737 Tests Begin
Investing.com
Published Jun 29, 2020 01:08PM ET
Updated Jun 29, 2020 03:07PM ET
By Yasin Ebrahim
Investing.com - Wall Street climbed Monday, led by industrials amid a surge in Boeing after the aircraft maker looked to restore its maligned reputation as the rectification process for 737 MAX jets got underway.
The Dow Jones Industrial Average rose 1.82%, or 455 points, the S&P 500 gained 0.98%, while the Nasdaq Composite added 0.62%.
Boeing (NYSE:BA) surged 12% as its 737 MAX jet was set to for its first Federal Aviation Administration recertification flight on Monday, marking a key step toward getting the planes, which have been grounded since March last year, back in operation.
The test would also examine whether the flaws in the 737 MAX's Maneuvering Characteristics Augmentation System (MCAS) - that many blame for the two crashes that killed 346 people – have been remedied.
The move higher in Boeing lifted sentiment across airlines as American Airlines (NASDAQ:AAL), United Airlines (NASDAQ:UAL) and Delta Air Lines (NYSE:DAL) rose sharply, despite lingering investor jitters about the weaker backdrop for aviation as Covid-19 cases continued to mount.
Coronavirus cases worldwide passed 10 million over the weekend, driven by an ongoing spread of the virus in the U.S., where the death toll has topped 125,000 with as many as 2.6 million confirmed infections.
The sharp jump in cases has added a sense of urgency to the development of treatments and vaccines.
Gilead Sciences (NASDAQ:GILD) on Monday said its coronavirus treatment, Remdesivir, would cost hospitals $3,120 for patients with private health insurance.
US health secretary Alex Azar has warned that "the window is closing" on the country’s chance to contain the coronavirus.
Energy, meanwhile, also lent support to the broader market, underpinned by rising oil prices as better-than-expected industrial data from China, the largest oil consumer, suggested its economic recovery remained on track.
Technology lagged the move lower, paced by a decline in Facebook (NASDAQ:FB) after Starbucks and Coca-Cola (NYSE:KO) joined in on the growing list of companies temporarily pausing social media advertising.
Elsewhere, Beyond Meat (NASDAQ:BYND) fell 9% after Barclays (LON:BARC) downgraded the stock to underweight from overweight, as an uncertain outlook for restaurant industry and a recovering meat supply chain are expected to weigh on growth.
On the economic data front, pending home sales rose a record 44.3% in May following a 34.6% decline in April, topping economists forecasts for a 19.3% in May.
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