Wall Street closes substantially higher as earnings season looms
- CBOE Volatility Index drops more than 5% on the day.
- Boosted by financials, DJIA adds 1.3%.
- Investors are eagerly waiting for the earnings season.
Major equity indexes started the week on a positive note and preserved their momentum to end the day with impressive gains as investors started pricing expectations of upbeat figures in the earnings season.
"The market is anticipating a very good earnings season and ignoring any trade issues. We're not likely to get much color on trade from this earnings, so the expectation is still for a very good season," Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago, told Reuters on Monday.
The positive market mood as reflected by a more than 5% drop in the CBOE Volatility Index, Wall Street's fear gauge, helped the risk-sensitive S&P 500 Information Technology Sector (SPLRCT) close 0.82% higher. In the meantime, despite the fact that crude oil struggled to extend its rally, the S&P 500 Energy Sector (SPNY) added 1.5%.
Furthermore, the strong economic growth and the upbeat macroeconomic data readings in the second quarter of the year point to potentially higher than expected earnings figures from financial giants. The S&P 500 Financials Sector (SPSY) rose 2.3% to become the best performing sub-index of the day.
At the end of the day, the Dow Jones Industrial Average gained 320.22 points, or 1.31%, to 24,776.7, the S&P 500 added 24.37 points, or 0.88%, to 2,784.19 and the Nasdaq Composite rose 67.81 points, or 0.88%, to 7,756.20.