U.S. stocks started the week on an upbeat note on Monday, continuing Friday’s payrolls-fueled rally as traders shrugged off global trade tensions.
What are markets doing?
The S&P 500 SPX, +0.31% were 8 points, or 0.3%, higher to 2,742, while the Dow Jones Industrial Average DJIA, +0.76% advanced 179 points, or 0.7%, to 24,813. The Nasdaq Composite COMP, +0.38% rose 25 points, or 0.3%, to 7,579.
The gains come on the heels of a strong session on Friday when the Dow finished 0.9% higher, the Nasdaq Composite Index rose 1.5% and the S&P 500 booked a 1.1% gain.
What is driving the market?
Investors continued to cheer a round of solid U.S. jobs data out on Friday, which showed the world’s largest economy in better economic health than expected. That helped spur a move back into riskier assets such as stocks, after political upheaval in Italy earlier last week sparked a flight into havens such as bonds.
The optimism over the American data also helped overshadow lingering concerns over global trade on Monday. A round of trade talks between the U.S. and China broke down over the weekend with no agreement, indicating a full-on trade war between the world’s two largest economies could be imminent.
Read: China warns U.S.: Trade agreements are off if tariffs are imposed
Meanwhile, finance ministers from Canada, France, Germany, Italy, Japan and the U.K. at a G-7 meeting on Saturday issued a rare rebuke to the U.S., expressing their “unanimous concern and disappointment” about President Donald Trump’s decision to place tariffs on metals imports from his major allies.
Tariffs and trade are also likely to feature highly on the agenda when leaders of the G-7 nations — including the U.S. — hold talks in Canada on Friday and Saturday.
What are strategists saying?
David Kelly, chief global strategist at JPMorgan Funds, said the U.S. economy is dealing with a combination of fiscal stimulus, which he likened to coffee, and a depressant in terms of trade tensions, which he compared to vodka.
“For the moment, the U.S. economy seems to be faring well on a diet of vodka and espresso. Longer term, however, a combination of excessive stimulus and protectionism domestically is a good reason for investors to make sure they have sufficient international diversification,” he said, in a note.
“Markets remain surprisingly sanguine despite trade war fears ramping up,” said Jasper Lawler, head of research at London Capital Group, in a note.
“There remains a certain level of optimism that this aggressive posture from Trump is a positioning that will quickly blow over, rather than result in the actual application of U.S. tariffs and the application of threatened retaliatory measures from the targeted countries,” he added.
What’s on the economic calendar?
U.S. factory orders fell by 0.8% in April, driven by a decline in commercial aircraft.
There will be no Federal Reserve speeches as the central bank is in its so-called blackout period ahead of its June 12-13 meeting.
See: MarketWatch’s economic calendar
Which stocks are in focus?
Nektar Therapeutics Inc. NKTR, -39.31% shares plunged 39% after “underwhelming” results from phase 1/2 clnical trials of its cancer drugs in combination with Bristol-Myers Squibb’s cancer drug Opdivo. Shares of Bristol-Myers Squibb BMY, -4.95% fell 6%.
Among the best performers on Wall Street were retail stocks. Shares of Target Corporation TGT, +4.74% rose 4.6%, Kohl’s Corp KSS, +2.71% rose 3%, while Macy’s Inc. M, +2.35% and Nordstrom Inc. JWN, +2.74% added more than 2.5% each.
Facebook Inc. FB, -0.52% shares were off 0.7%. The New York Times reported that the social media company made agreements with at least 60 makers of phones and other devices that gave them access to the personal information of users’ friends without their consent. Facebook said it disagreed with the issues raised.
Shares of Microsoft Corp. MSFT, +0.53% rose 0.5% after the software giant said it had agreed to buy software-developer platform Github for $7.5 billion.
Advanced Micro Devices Inc. AMD, +1.11% rose 1.6% after surging 4.9% to end at a 10-month high on Friday following a favorable analyst note.
What are other markets doing?
Asian stocks closed mostly higher, as traders there got their first chance to react to the upbeat U.S. jobs data from Friday. Japan’s Nikkei 225 index NIK, +1.37% ended 1.4% higher, while Hong Kong’s Hang Seng Index HSI, +1.66% climbed 1.6%.
Europe traded higher, setting the Stoxx Europe 600 index SXXP, +0.31% on track for its highest close since May 25.
Crude oil prices CLN8, -1.15% were lower, while gold GCQ8, -0.09% hovered near unchanged. The ICE U.S. Dollar Index DXY, -0.17% fell 0.1% to 94.077.