U.S. Stocks Rise on Reopenings as Investors Put Aside Protests
Will Trump deploy the military to stop the protests?
Stocks inched higher by midday Tuesday as investors have shifted their focus on reopening across the U.S. despite massive protests in the country.
New York City, which has been hit harder by Covid-19 than some countries, is set to enter a Phase 1 reopening on June 8, enalbing industries like nonessential construction, manufacturing, wholesale and nonessential retail whose business is limited to curbside or in-store pickups to resume. New York City has met five of the seven state-mandated requirements to begin reopening. Of course, the city has already been open for days if you count the massive protests of people, many of whom are unmasked.
Meanwhile, the Western region of New York can enter Phase 2 today followed by the Capital Region tomorrow. The Phase 2 plan permits office-based workers, real estate services, in-store retail shopping, and some barbershop services to resume.
Across the river, New Jersey will enter "Stage 2" in two weeks in it which will begin reopening outdoor dining.
Intraday Tuesday, the Dow Jones gained 124 points, while the S&P 500 added just four.
As protestors continue to march across the states over the death of George Floyd, New York City has implemented another curfew, which will start at 8 p.m. and lift at 5. a.m. Those curfew times will be extended through the end of the week, as Mayor Bill de Blasio announced Tuesday.
"The violence and the looting that has gone on in New York City has been bad for the city, the state and this entire national movement, undermining and distracting from this righteous cause," New York Gov. Andrew Cuomo said on Monday.
He added, "While we encourage people to protest peacefully and make their voices heard, safety of the general public is paramount and cannot be compromised."
That was then followed by President Trump threatening states and cities on Monday he feels have not stepped up, warning that he will deploy the military and "quickly solve the problem for them."
Critics say military action could increase the growing problem of agoraphobia, causing further economic distress.
"Anarchy in the streets threatens to throw a wet blanket on risk recovery as investor optimism over economic reopening in the U.S. could wane," Michael Hewson, a chief market analyst at CMC Markets UK said.
He added, "It's unlikely they will feel any safer with military Humvees rolling down Pennsylvania Avenue."
On the other hand, keeping people inside could prevent a spike in Covid-19 cases, as protests have drawn large crowds, violating social distancing.
Investors will get set for Zoom Video Communications Inc. (Nasdaq: ZM) to report its financials on Tuesday after the markets close. The online chat providers' shares have surged more than 190% year-to-date, as of midday Tuesday.