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After the US stocks have topped record highs this year, the bar to exceed the record levels has been raised significantly.
The Dow Jones Industrial Average (INDEXDJI: . DJI) jumped 316.01 points or 0.93% to 34,137.31 as the US stocks rebounded from a two-day loss. Along with the Dow Jones, the S&P 500, the Nasdaq Composite, and the Russell 2000 all surged on the 21st of April. On the day, S&P 500 rose by 0.9% to 4,173.32, the Nasdaq Composite gained 1.2% to 13,950.22, while the small-cap Russell 2000 rallied 2.4%, pushing its year-to-date increase to over 13%.
US Stocks Recovery
The shares of American cruise line Norwegian Cruise Line Holdings Ltd (NYSE: NCLH) advanced over 10%. The company led the rebound after investment firm Goldman Sachs (NYSE: GS) upgraded its shares from neutral to buy in the late hours of the 20th of April. According to Goldman Sachs, Norwegian Cruise Line Holdings has a potent business mix and balance sheet.
Also, Carnival Cruise Line (NYSE: CCL) climbed 6.3%, while Royal Caribbean (NYSE: RCL) surged 4.4%.
United Airlines Inc (NASDAQ: UAL) lost 8.5% after the airline reported a 1.4 billion decline, representing its fifth straight quarterly loss. At the time, the carrier CEO Scott Kirby noted that the company is uncertain when the two major parts of the business will recover from the harmful effect of the coronavirus pandemic. In an interview with CNBC Squawk Box, Kirby said the airline’s major segments would most likely begin to recover over the summer or in the second part of 2021.
However, the company also spiked 3%, recovering from the 8% shed.
Streaming service provider and production company Netflix Inc (NASDAQ: NFLX) plummeted more than 7% following the company’s report that showed that new subscribers dropped below Wall Street expectations. Notably, the increased demand Netflix saw during the global lockdown is beginning to fade. Netflix added that it expects an addition of 1 million subscribers in this quarter. The expectation is, however, below estimates.
As companies rebound from losses, Wells Fargo’s senior global market strategist, Scott Wren, said:
“It appears the economy is now well on its way to recovery. Still, earnings guidance early in the current reporting season appears to lean more conservative than our economic projections suggest.”
Dow Jones and S&P 500 Up 11% in Year-to-Date Record
After the US stocks have topped record highs this year, the bar to exceed the record levels has been raised higher. This is despite the profitable quarterly results that several companies have been delivering. After recently climbing records highs, the Dow Jones and the S&P 500 are both up 11% for the year.
According to CNBC calculations, S&P 500 companies have been performing better than analyst predictions. CNBC said over 70 S&P 500 companies that have reported their earnings posited a 23% gain above estimates.
The CIO at UBS, Mark Haefele, said that “market vitality has picked up.” He noted that the volatility is occurring amid inflation concerts, pandemic, and lower-than-expected earnings report from Netflix. “While we see further spikes in volatility ahead, we expect the market rally to continue and the rotation trade to resume,” added he.