Stock prices climbed higher in June, as investors looked beyond an increase in COVID-19 cases as well as reports that several states planned to slow the pace of their economic re-opening.
The Dow Jones Industrial Average gained 1.69%, while the Standard & Poor’s 500 Index tacked on 1.84%. The Nasdaq Composite, already up 6.75% in May, rose another 5.99%.1
Stocks opened the month higher, but the momentum quickly stalled, as states struggled to re-open their economies while facing an increase in COVID-19 cases. Investor sentiment was further dampened by a subdued forecast of economic recovery issued by the Federal Reserve.
But the market turned and rallied on a series of upbeat news announcements. First, by the Fed, which said that it would extend its bond-buying program to include the debt of individual companies. Second, a strong retail sales report buoyed spirits. And finally, the news of an effective COVID-19 treatment for critically ill patients strengthened investor sentiment.
Bump Up in COVID-19
Market direction reversed late in the month, due to an increase in COVID-19 cases in Florida, Texas, and California, which prompted some states to roll back their re-opening plans.
However, stocks still closed out the month strong, posting back-to-back gains to cement a solid showing.
Industry sectors were mixed in June, with gains in Consumer Discretionary (+1.54%), Industrials (+0.95%), Materials (+0.18%), and Technology (+4.78%), while losses were posted by Communication Services (-1.07%), Consumer Staples (-1.72%), Energy (-4.54%), Financials (-2.48%), Health Care (-4.49%), Real Estate (-0.98%), and Utilities (-5.81%).2