Markets Up as the Economy Begins to Reopen

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The stock markets, oil, and gold all performed well at the beginning of the trading week, although investors are not sure how long these gains are expected to continue. The three major stock exchanges all performed well on Monday, closing with gains. The Dow Jones rose by 0.6% to close at 26,024.96 points. S&P 500 gained 0.7% to finish the day at 3,117.86 points. Nasdaq continues to be the most significant winner thanks to the massive gains from tech companies, rising 1.1% to 10,056.47. This is the highest close that Nasdaq has ever experienced, which was pushed mostly by the massive gains from Apple.

The company held its annual Worldwide Developers Conference, where it announced all of the new software changes they are about to make, as well as announcing that Apple will be shifting from Intel chips to produced in-house. Other tech companies that posted significant gains included Netflix (2.6%), Microsoft (2%), and Amazon (1.5%). Retail stores are also seeing jumps in the value of their stock as more of the country begin to reopen after the COVID-19 shutdown. Gap gained 8.3% on Monday after Wells Fargo upgraded the company. Walmart also increased 1% after UBS upgraded it.

U.S. oil prices rose on Monday as well, as demand for the resource continues to grow. Brent Crude gained 2.11% (89 cents) to end the trading day at $43.08 per barrel. West Texas Intermediate Crude gained 1.79% (71 cents) to finish at $40.46 per barrel. These prices were also driven by reduced supply, as oil rigs continue to shut down. The number of operating platforms in the United States is now at 189, a level that has not been seen since 2009. Although this helps to drive oil prices up now, it is expected that there will be a struggle to get the industry operating at full capacity on time in the future. 

The price of gold rose by just over 1% as some investors remain wary of the broader global COVID-19 situation, even though the American market appears bullish. Other countries, especially in Latin America, are still seeing considerable increases in the daily rates of new coronavirus cases. This could create a global impact that may have significant implications for the U.S. economy. Therefore, many people are still choosing to invest in safe havens such as gold as a precautionary measure.

Bitcoin, also known as “digital gold,” is not faring as well, making it one of the only types of significant investments to be currently struggling. The largest cryptocurrency is failing to gain reliable, prolonged traction above the psychological $10,000 mark, which may signal the end of the significant rally it has been experiencing this year up until this point. Bitcoin has gained over 30% in value, but this trajectory has recently stopped. Bitcoin quarterly options totaling $930 million are also scheduled to expire at the end of the week. This could signify future price volatility, as previous expiries have done. Investors expect people to hold onto their bitcoin, in an attempt to utilize it as a haven asset in the short-term, reaping more significant rewards in the longer term.

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