Wall Street rally gets back on track; stocks and yields rise

Stocks are climbing on Wall Street Tuesday, recovering some of last week's losses to pull closer to ir record highs.

S&P 500 was 0.6 per cent higher in early tring and got back within 1per cent of its record set earlier this month.

Dow Jones Industrial Aver was up 140 points, or 0.5 per cent, at 30,955, as of 9:47 a.m. Eastern time, and Nasdaq composite was 0.8 per cent higher.

Wall Street's rally is getting back on track after stocks ran out of steam last week. Markets have been rising on enthusiasm about a coming ecomic recovery as COVID-19 vaccines roll out and amid expectation that Washington will soon try to deliver ar massive round of stimulus for ecomy.

Janet Yellen, President-elect Joe Biden's minee to be Treasury Secretary, is calling on Congress to do more to boost ecomy. In testimony prepared for her confirmation hearing on Tuesday, she said that with interest rates near ir record lows, “ smartest thing we can do is act big” to avoid an even worse downturn in near term and scarring for ecomy in long term.

Biden last week released details of a USD1.9 trillion plan to bolster ecomy, which would include USD1,400 cash payments for most Americans.

Democrats are also pushing for an accelerated rollout of COVID-19 vaccines, a higher minimum w for workers and enhanced benefits for laid-off workers.

hope is that such stimulus can carry ecomy until later this year, when more widespre vaccinations get life returning to some semblance of rmal.

case for such stimulus has been rising by day. Dismal reports have piled up showing how worsening pandemic has more workers applying for jobless benefits and shoppers feeling less confident.

Tuesday's Senate Finance Committee hearing with Yellen is one of several that Senate will be holding as incoming Biden ministration tries to get its top Cabinet officials in office quickly.

Biden is set to take oath of office on Wednesday, ending President Donald Trump's four-year term.

Besides stocks, optimism about an eventual acceleration for ecomy and ar round of stimulus have also helped push Treasury yields up sharply recently.

yield on 10-year Treasury climbed back to 1.11per cent from 1.08per cent late Friday. It's been rising sharply this month on a combination of expectations for more U.S. government borrowing, stronger ecomic growth and higher inflation.

Higher rates could eventually d pressure on stocks, underscoring more how expensive stocks have become relative to profits that companies are producing.

But some areas of stock market could benefit, including banks. Higher rates and a healthier ecomy would allow m to earn bigger profits from making loans.

Bank of America was flipping between small losses and gains in morning tring after reporting a weaker profit for last three months of 2020 than a year earlier, but still above analysts' expectations.

bank also said expectations for a healing ecomy mean it doesn't need to hold onto as much in reserves to cover for potentially b loans.

Goldman Sachs, State Street and Halliburton also reported stronger results for end of 2020 than analysts expected as earnings reporting season picks up pace.

Wall Street is expecting a relatively weak showing this time around, with ar sharp drop in earnings per share. But analysts expect growth to rebound powerfully through 2021.

General Motors jumped 8.4per cent for one of biggest gains in S&P 500 after it said it will work with Microsoft and self-driving car company Cruise to develop automous, all-electric vehicles. GM, Microsoft, Honda and or investors will also pump USD2 billion into Cruise, valuing it at USD30 billion.

Microsoft ded 0.3per cent.

In Europe, Germany's DAX returned 0.1per cent, and France's CAC 40 slipped 0.1per cent. FTSE 100 in London dipped 0.1per cent.

In Asian markets, Hong Kong's Hang Seng gained rose 2.7per cent, Nikkei 225 in Tokyo gained 1.4per cent and South Korea's Kospi jumped 2.6per cent. Stocks in Shanghai slipped 0.8per cent.

On Monday, tring got off to a slow start for week around world with U.S. markets closed in observance of Martin Lur King Day. (

Im Credits: AP