U.S. stocks are rising as megacaps stage a rebound

  • Investing.com
  • Stock Market News
U.S. stocks are rising as megacaps stage a rebound
Credit: © Reuters.

Investing.com -- U.S. stocks are rebounding after strong data on capital goods orders overcame fears about a possible recession ahead.

At 9:43 ET (13:43 GMT) the Dow Jones Industrial Average was up 130 points or 0.3%, while the S&P 500 rose 0.4% and the NASDAQ Composite rose 0.5%.

The indexes resumed their rally as megacap stocks rose, though Walgreens Boots Alliance Inc (NASDAQ: WBA ) shares fell 9% after the drugstore retailer cut its fiscal year profit outlook because demand for COVID vaccines and tests is waning.

Economic data fuels optimism

Durable goods orders rose 1.7% in May, well more than the expected 1% drop. The data is a closely monitored measure of business spending. Core goods orders rose 0.6%, also beating expectations.

Stocks stalled on Monday as fears about a recession crept higher. The Federal Reserve paused on interest rate hikes at its meeting this month but signaled another rate hike is possible, perhaps as early as July, as it continues to battle inflation .

Investors await Fed’s next move

Investors are worried that more rate hikes could eventually tip the economy into a recession, though Wall Street economists have lowered their expectations in recent weeks.

Futures traders see a greater than 75% probability that the Fed will raise rates another quarter of a percentage point in July.

Investors will hear more from top policymakers this week when they meet in Portugal at the European Central Bank Forum, including a speech by Fed Chair Jerome Powell.

June is quickly coming to an end this week, and the second quarter with it, with the three major indexes poised to record gains for the period.

Lordstown Motors files for bankruptcy

Electric vehicle maker Lordstown Motors Corp (NASDAQ: RIDE ) shares sank 49% as it sought bankruptcy protection and put itself up for sale. It couldn’t resolve a dispute over an investment from Taiwan-based manufacturer Foxconn (TW: 2354 ).

Shares of cloud analytics company Snowflake Inc (NYSE: SNOW ) rose 2.9% on an arrangement with Nvidia (NASDAQ: NVDA ) allowing customers to build artificial intelligence models using their own data.

Oil prices continue to stabilize after Russia turmoil

Oil fell slightly. Crude Oil WTI Futures were down 1.2%, to $68.56 a barrel, while Brent Oil Futures fell 1% to $73.59 a barrel, after the weekend turmoil in Russia. Gold Futures rose 0.1% to $1,936.

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