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Wall Street Set To Jump After Record Rise In May Retail Sales

By Donna Ahern
Wall Street Set To Jump After Record Rise In May Retail Sales

Wall Street was set to jump on Tuesday after a record rise in May retail sales revived hopes of a swift post-pandemic economic rebound, with sentiment also lifted by data showing reduced COVID-19 death rates in a trial of a generic steroid drug.

A Commerce Department report showed overall retail receipts rose 17.7% last month as Americans resumed spending after weeks of lockdown although the rebound retraces only a fraction of the historic drops in March and April.

Department store operators Macy's Inc, Kohl's Corp and Nordstrom Inc surged between 11.5% and 14.6% in premarket trading.

Results from a UK-led trial showed giving low doses of the generic steroid drug dexamethasone to patients admitted to hospital with COVID-19 reduced death rates by around a third among those with the most severe cases of infection.

"Looking at this morning's number in aggregate, this is another indicator that a V-shaped recovery could be more likely than we initially thought," said Mike Loewengart, managing director of investment strategy at E*TRADE Financial Corp.


"A potential COVID-19 steroid treatment in the UK combined with record retail sales and news of additional stimulus has been met with unbridled optimism."

U.S. stocks ended a volatile session higher on Monday as the Federal Reserve said it would start buying corporate bonds to infuse liquidity. A report overnight said the Trump administration was preparing a nearly $1 trillion infrastructure proposal.

Investors will keep a close watch on a live telecast of Fed Chair Jerome Powell's two-day testimony before the Congress, which is expected to begin at 10 a.m. ET.

'Fresh Record Highs'

Powell's remarks are set to come after the U.S. central bank issued a grim outlook last week, sparking a pullback in a stock market rally that has powered the Nasdaq to fresh record highs.


The benchmark S&P 500 index is now about 9% below its record high hit four months earlier after coming within 5% of that level early last week.

At 9:02 a.m. ET, Dow e-minis were up 905 points, or 3.51%. S&P 500 e-minis were up 86.25 points, or 2.81% and Nasdaq 100 e-minis were up 200.75 points, or 2.05%.

Shares from economically-sensitive industrial, financial and energy sectors climbed in premarket trading. Caterpillar Inc jumped 7.3% and Boeing Co climbed 8.9%, while lenders including Bank of America Corp and Citigroup Inc rose 5.5% and 6.3%.

Oil majors Exxon Mobil Corp added 5.1% and Chevron Corp 4.4%.

Eli Lilly and Co jumped 9.2% after its breast cancer therapy Verzenio met the main goal of reducing the risk of it returning in the early stages in a late-stage study.

News by Reuters, edited by Donna Ahern, Checkout. Click subscribe to sign up for the Checkout print edition.

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