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Portfolio > Economy & Markets > Stocks

Epic Stock Rally Erases S&P 500’s Coronavirus Crash

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The torrid rally in U.S. stocks pushed the S&P 500 into the green for the year as easing lockdowns bolstered economic optimism. The dollar fell.

The equity benchmark extended a rally from its 2020 low to almost 45%, rising to a 15-week high. Occidental Petroleum Corp. surged after Bloomberg News reported the company is reviewing options for its Middle Eastern assets. The Nasdaq 100 rose to a record high, and Boeing Co. led gains in the Dow Jones Industrial Average. The dollar posted its longest slide in almost a decade, while Treasuries advanced. Oil sank after Saudi Arabia said it wouldn’t continue its additional, deeper output curbs after June.

Chart: Bloomberg

Traders pushed up the value of U.S. equities as many parts of the country came out of the shutdowns that brought the world’s largest economy to a standstill. To Citigroup’s strategists including Tobias Levkovich, positioning may be overly extended, and investors may not be factoring all the potential risks. Meanwhile, Stan Druckenmiller — who last month warned about owning stocks — said on Monday that he now believes he was “far too cautious” during the current market rally.

“As long as the data is improving and the market has the tailwind of liquidity at it’s back, it’s probably going to continue to rise,” said Ed Campbell, portfolio manager and managing director at QMA. “I wouldn’t be betting against equities at this point.”

The dollar fell for an eighth straight day, down to the level before the coronavirus crisis sparked a rush to haven assets. Where it goes from here mostly depends on the Federal Reserve, which will probably welcome all signs of recovery in its statement at the conclusion of this week’s meeting. But policy makers may be wary of an unruly increase in borrowing costs that could add to strains on businesses and households, and raise the price tag of the government’s rescue efforts.

What to watch this week:

  • The Fed’s next policy decision is Wednesday. Officials are expected to leave rates above zero.
  • OECD releases its economic outlook Wednesday, a twice-yearly analysis of the economic prospects of member countries
  • Euro-area finance ministers meet Thursday to discuss the EU’s recovery package and Eurogroup presidency succession.

These are some of the main moves in markets:


  • The S&P 500 Index climbed 1.2% to 3,232.39 as of 4 p.m. New York time.
  • The Stoxx Europe 600 Index fell 0.3%.
  • The MSCI Asia Pacific Index increased 1.2%.


  • The Bloomberg Dollar Spot Index fell 0.6%.
  • The euro was little changed at $1.1296.
  • The Japanese yen appreciated 1.1% to 108.37 per dollar.


  • The yield on 10-year Treasuries decreased two basis points to 0.87%.
  • Germany’s 10-year yield decreased four basis points to -0.32%.
  • Britain’s 10-year yield declined two basis points to 0.334%.


  • The Bloomberg Commodity Index decreased 0.1%.
  • West Texas Intermediate crude decreased 3.3% to $38.23 a barrel.
  • Gold surged 1.4% to $1,706.30 an ounce.

– With assistance from Cormac Mullen, Masaki Kondo, Todd White, Lynn Thomasson, Sophie Caronello and Nancy Moran.

— Check out Why Were the Unemployment Numbers So Messed Up? on ThinkAdvisor.

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