NEW YORK (AFP) – Equities tied to the US economic recovery led stocks higher on Tuesday (Jan 12) as markets bet on more government stimulus and coronavirus vaccines in 2021.
Petroleum-linked shares were winners, along with airlines, retailers and infrastructure as investors anticipate gains for beaten-down sectors that have suffered during Covid-19.
“I do believe there’s going to be a pretty strong recovery driven by stimulus infrastructure spending, now that you have a Democrat controlled government,” said Shawn Cruz of TD Ameritrade.
“It will make it easier to get some of those probably larger stimulus Bills through.”
The Dow Jones Industrial Average finished up 0.2 per cent at 31,068.69.
The broad-based S&P 500 climbed less than 0.1 per cent to 3,801.19, while the tech-rich Nasdaq Composite Index advanced 0.3 per cent to 13,072.43.
The gains came after US equities pulled back on Monday over fears of more unrest after a mob of President Donald Trump’s supporters last week attacked the Capitol in an unsuccessful effort to block certification of Joe Biden’s victory in the November elections.
Petroleum producer Apache surged 11.2 per cent, while United Airlines won 3.2 per cent and Caterpillar gained 1.9 per cent. All are seen as winners during a period of economic growth.
Among individual companies, General Motors surged 6.2 per cent as it unveiled plans Tuesday to build electric vans under the new BrightDrop brand.
GM announced a venture with delivery giant Fedex to test new vehicles. The move comes with GM and other automakers racing to keep pace with electric carmaker Tesla’s dizzying growth, and as Amazon is set to launch its own electric delivery vans from the startup Rivian.
Walmart gained 1.1 per cent as it announced a new fintech startup with Ribbit Capital, the global investment firm behind Robinhood and other ventures.