US stocks hit new high after coronavirus crash

Image copyrightReutersImage caption

The speed of this rebound is unusually fast - and surprising given the concerns about the economy

A key US stock index has hit a new high despite ongoing worries about the sharp economic impact of the pandemic.

The S&P 500, one of the widest and most prominent US market measures, inched higher on Tuesday to close at 3,389.78 - about three points above its 19 February record.

Other US indexes have also rebounded.

The Nasdaq hit another record after surpassing its prior high in June while the Dow Jones Industrial Average is within about 5% of its February record.

US shares have been on an upward path since 23 March, when America's central bank announced a slew of unprecedented economic support measures.

• Trading: 'I didn't know I'd lose money so fast'

• US economy suffers sharpest contraction in decades

But when the pandemic set in and markets tumbled more than 33%, such a rapid market recovery seemed nearly unthinkable, said William Delwiche, an investment strategist at Baird.

“To be even having this conversation right now is remarkable,” he said.

He said the strength and speed of the rebound was especially surprising, given America's continuing struggle to contain the coronavirus and ongoing concerns about the economy. The US saw its sharpest quarterly contraction on record in the three months to July, amid widespread lockdowns.

“It's not surprising that we had a meaningful recovery, but that over the last couple of months we've continued to rally... I'm shocked that we're having this conversation,” Mr Delwiche said.

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分析师说复苏的部分原因是美联储的动作和其他的刺激，以及投资者谁相信经济会愈合，看到一些更好的赚钱机会比股市的需求。

{17 } 虽然奇怪，这样一个迅速的市场反弹并非没有先例，山姆斯托瓦尔，在CFRA Research首席投资策略师说。根据他的计算，它实际上是第三上升最快，为标准普尔以来的新高1929年这样的深跌之后。 {17} 但是，在美国的收益已经超过了许多其他市场。伦敦富时100遗体约20％比其一月高降低，而法国CAC 40是关闭的约19％。

日本，这已经看到在4％以内其经225指数爬升回其危机前的高点，已经从两个积极的政府刺激和相对成功，在控制病毒而不质量lockdowns受益。

科技股带动升势

美国的反弹不寻常的力量来自于它的高科技公司，如苹果，微软和亚马逊，已在云计算和机器学习领域被视为中奖，尽管lockdowns，与公司一起。

“我们不会与所有的时间调情高位要是没有技术，”特里Sandven，在美国银行财富管理公司首席股票策略师说。

{ 777} 在标准普尔500指数的科技股股份今年迄今上涨约25％，甚至其他地区持平或负。能源部门，例如，是下降大约37％，因为一月初，而财务数据下降了约20％。 {777} 市场断开

{25 } 霍华德西尔弗布拉特，在标普道琼斯指数资深指数分析师表示，对于那些谁可能想看看新的S＆P 500指数高作为对更广泛的经济信号的警告信号。 {25} {26 } “还有那些之间已经做得很好而那些牛逼大分散在已经做得不好，”他说。 {26} {} 27 图像copyrightReutersImage标题纽约证交所三月关闭交易大厅后重新开放面对面交易在五月 {27} 总的来说，普500是最多约4％，因为年的开始。500

但公司在索引中，有一半以上的股票走低比他们一年的开始，他说，这就是即使大公司在S＆P 500指数能够更好地承受经济衰退比许多小公司。

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Media captionDespite the economy shrinking, US stocks have rallied

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Analysts say the recovery is partly due to Federal Reserve moves and other stimulus, as well as demand from investors who are confident the economy will heal and see few better opportunities to make money than on the stock markets.

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While surprising, such a speedy market rebound is not unprecedented, said Sam Stovall, chief investment strategist at CFRA Research. By his calculations, it's actually the third fastest rise to a new high for the S&P after such a deep fall since 1929.

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But the gains in the US have outstripped many other markets. London's FTSE 100 remains about 20% lower than its January high, while France's CAC 40 is off about 19%.

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Japan, which has seen its Nikkei 225 index climb back within 4% of its pre-crisis high, has benefited from both aggressive government stimulus and relative success at controlling the virus without mass lockdowns.

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Tech stocks drive the rally

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The unusual strength of the US rebound comes from its tech companies, such as Apple, Microsoft and Amazon, which have been seen as winners despite lockdowns, along with companies in areas like cloud computing and machine learning.

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“We would not be flirting with all-time highs were it not for technology,” said Terry Sandven, chief equity strategist at US Bank Wealth Management.

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Shares in the S&P 500's tech sector have climbed roughly 25% so far this year, even as other areas remain flat or negative. The energy sector, for example, is down roughly 37% since the beginning of January, while financials are down about 20%.

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Market disconnection

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Howard Silverblatt, senior index analyst at S&P Dow Jones Indices, said that's a warning sign for those who might want to see the new S&P 500 high as a signal about the broader economy.

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“There's big dispersion between those that have done well and those that have done poorly,” he said.

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Image copyrightReutersImage caption

The New York Stock Exchange reopened for in-person trading in May after closing the trading floor in March

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Overall, the S&P 500 is up about 4% since the start of the year.

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But of the 500 companies in the index, more than half have shares trading lower than they were start of the year, he said. And that's even though the big companies in the S&P 500 index are better equipped to withstand a downturn than many smaller firms.

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“We've come a long way and there's a lot of optimism in there and that is concerning,” Mr Silverblatt said. “If we don't get what we expect - disappointment is not a good item in the market.”

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Mr Sandven said unless prospects for the wider economy improve further gains will be limited.

Political questions - about whether Washington will approve further economic stimulus and how the US presidential election will play out - could also mean a bumpy ride ahead for investors, he added.

“Clearly there's a lot of optimism riding on a return to growth in 2021,” Mr Sandven said. “But there's reason for caution.”