The S&P 500 rallied on Tuesday (June 30) to finish higher and secure its biggest quarterly percentage gain in more than two decades as improving economic data bolstered investor beliefs that a stimulus-backed rebound for the U.S. economy was on the horizon.
Coming off a drop of 20% in the first quarter, the biggest quarterly decline since the financial crisis in the fourth quarter of 2008, the S&P rallied more than 19% to notch its biggest quarterly gain since 1998, at the height of the tech boom.
The gains have been fueled by unprecedented levels of fiscal and monetary stimulus and the easing of restrictions.
But the S&P 500 is still down about 4% on the year, and gains in June stood just over 1% due to the flare-up in virus cases that has threatened to delay reopenings and derail a tentative economic recovery. Federal Reserve Chairman Jerome Powell reiterated in comments on Tuesday that the path of the economy is “highly uncertain.”
Anthony Fauci, the U.S. government’s top infectious diseases expert, said there was no guarantee the United States will have an effective COVID-19 vaccine and warned the virus spread “could get very bad.” It was a reminder that a full economic recovery could be a long road.
Gains were capped on the Dow, pressured by a drop in Boeing Co, as the airplane maker gave back some of Monday’s 14% surge after Norwegian Air canceled orders for 97 aircraft and said it would claim compensation.
Unofficially, the Dow Jones Industrial Average rose 241.16 points, or 0.94%, to 25,836.96, the S&P 500 gained 48.55 points, or 1.59%, to 3,101.79 and the Nasdaq Composite added 190.65 points, or 1.93%, to 10,064.81.
(Production by Fred Katayama, Hyeongmi Kim and Roselle Chen)