US STOCKS-Wall Street ends higher on recovery hopes, Nasdaq hits another record

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By Sinéad Carew
June 23 (Reuters) - Wall Street's three major indexes
*closed higher* on Tuesday as improving economic data and the
prospect of more stimulus bolstered hopes of a swift recovery,
while a jump in technology shares powered the Nasdaq to another
record high.
The Nasdaq registered its fifth record high close this month
with Apple Inc AAPL.O providing the biggest boost.
Data showed that the pace of contraction in the U.S.
manufacturing and services sectors slowed in June as businesses
reopened after lockdowns that started in mid-March. Also, new home sales jumped 16.6% in May, blowing past
estimates of a 2.9% rise. "The cumulative effect of the economic data we've been
seeing is helping to support the V-shaped rally we've had in
stocks," said Mark Luschini, chief investment strategist at
Janney Montgomery Scott in Philadelphia.
"It's reinforcing views that equities can continue to
advance even though there's a fair amout of economic damage
that's going to loiter for some time to come, such as elevated
unemployment readings and the slow recovery in travel, leisure
and entertainment industries."
Despite rising coronavirus cases, Luschini noted that the
lack of appetite for further economic lockdowns among federal
and state officials was likely cheering investors.
The mood may have been dampened a little by a New York Times
report that European Union countries were prepared to block
Americans from entering because the United States has failed to
control the coronavirus pandemic. But it helped that government officials were talking about
further stimulus, Luschini added.
Then U.S. Treasury Secretary Steven Mnuchin said that the
next stimulus bill will be focused on getting people back to
work quickly and that he would consider a further delay of the
tax filing deadline.
Earlier in the day White House economic adviser Lawrence
Kudlow said tax rebates and direct mail checks are on the table
in the next coronavirus relief bill. Unofficially, the Dow Jones Industrial Average .DJI rose
130.8 points, or 0.5%, to 26,155.76, the S&P 500 .SPX gained
13.4 points, or 0.43%, to 3,131.26 and the Nasdaq Composite
.IXIC added 74.89 points, or 0.74%, to 10,131.37.
Nine of the 11 major sub-indexes were higher with technology
.SPLRCT and consumer discretionary .SPLRCD posting the
steepest gains.
The defensive real estate .SPLRCR and utilities .SPLRCU
sectors slipped as investors felt more comfortable taking
riskier bets.
"Technology has taken on a bit of a defensive role as well
but one that offers better growth potential than utilities or
real estate," said Luschini.
It also helped that at least three brokerages raised their
price targets for Apple's stock, and UBS raised its iPhone
shipment estimates a day after the iPhone maker said it would
use its own chips for Mac computers. Earlier global equity markets had shown some relief from
U.S. President Donald Trump's assurance that the Phase 1 trade
agreement with China was "fully intact" after adviser Peter
Navarro sparked confusion by saying the deal was over.
While U.S.-China tensions have been a cause for concern,
monetary and fiscal support worth trillions of dollars has
played a large part in powering gains in the benchmark S&P 500
.SPX which closed 7.5% below its Feb. 19 record high.
Nike Inc NKE.N rose as brokerages raised their price
targets ahead of quarterly results on Thursday.
Spirit AeroSystems Holdings SPR.N fell sharply after the
company, which is Boeing Co's BA.N top supplier, said it was
seeking relief from lenders as its finances were stretched by
the COVID-19 pandemic and a 737 MAX production halt.