US markets finished strong on the first day of the second quarter.
The Dow finished up nearly 330 points, or 1.3%. It’s the index’s highest close since October. The S&P 500 increased 1.1%, while the Nasdaq advanced 1.3%.
Bank of America (BAC), Citigroup (C) and JPMorgan Chase (JPM) all finished roughly 3.5% higher — a solid recovery for bank stocks, which had been struggling.
Lyft (LYFT) ended the day down nearly 12%, dragging the stock to $69 per share. That’s below the company’s $72 IPO price when it debuted last Friday.
Kellogg (K), meanwhile, fell more than 2% on news that it is selling its Keebler cookies, Famous Amos, Mother’s, Murray’s and Girl Scout cookies brands to Ferrero for $1.3 billion.
The second quarter is off to a stellar start.
The Dowjumped 255 points, or 1%, in Monday afternoon trading, touching the best levels of the day.
The S&P 500 climbed 0.8%, while the Nasdaqclimbed almost 1%.
The broad rally builds on what was a remarkable first quarter. The S&P 500 surged 13%, its best quarter since 2009.
Lyft (LYFT), the newest major member of the stock market, did not join in the fun. The ridesharing company’s stock tumbled 11% on Monday. Worse, Lyft broke well below its $72 IPO price.
In better news, bank stocks climbed sharply, building on their recent recovery. Bank of America (BAC) and Citigroup (C) jumped more than 3% apiece.
Ferrero, which makes Nutella, Tic Tacs, Ferrero Rocher chocolates and other treats, is buying Kellogg’s Keebler cookies, Famous Amos, Mother’s, Murray’s, Girl Scout cookies and fruit snacks brands for $1.3 billion.
“Divesting these great brands wasn’t an easy decision,” said Steve Cahillane, Kellogg’s CEO, in a statement. The deal should help “reshape and focus our portfolio,” he added, “which will lead to reduced complexity, more targeted investment, and better growth.”
For Ferrero, the acquisition is a way to expand its North American business.
The deal “[allows] us to significantly diversify our portfolio and capitalize on exciting new growth opportunities in the world’s largest cookies market,” said Lapo Civiletti, CEO of the Ferrero Group.
Wall Street wasn’t too impressed with the news. Shares of Kellogg (K) sank nearly 2% on Monday.
Wall Street is following its best quarter in nearly a decade with even more buying.
The rally comes after the S&P 500 notched its best quarter since 2009. Global markets were boosted again on Monday by a surprise rebound in Chinese manufacturing activity.
However, Lyft (LYFT) plunged 10%, breaching its $72 IPO price. The sharp selloff comes after Lyft’s solid debut on the Nasdaq on Friday
Kellogg (K) fell slightly after announcing a $1.3 billion deal to sell snack brands including Keebler and Famous Amos to Nutella maker Ferrero.
Investors continue to monitor cautionary signals set off by the bond market, where Treasury bond yields have plunged due to slowdown fears. The 10-year Treasury rate stood at 2.44% on Monday, down sharply from 2.75% a month ago.
“Bond yields are falling, apparently under the influence of recessionary gravitational forces, while stock prices seem to be achieving escape velocity,” Ed Yardeni, president of Yardeni Research, wrote in a note to clients.
Saudi Aramco, divulging its finances for the first time, revealed that it is the world’s most profitable company.
The Saudi oil company made $111 billion last year, according to a note from Moody’s.
By comparison, Apple (AAPL), the world’s most profitable public company, made $59.4 billion in 2018, just over half as much as Aramco. ExxonMobil (XOM) made $20.8 billion.
Amid all those concerns about slowing US growth and a recession indicator flashing in the bond market, stocks had a terrific first quarter. The S&P 500 up 13.1% was the best quarter since 2009 and the best first quarter since 1998.
I’m looking for a crush of data this week to either confirm those slowdown concerns or repudiate them.
First up is retail sales and the week winds down with the March jobs report. Data this week could help confirm what the bond market has been telling us, or it could tell us the bond rally is overdone.
Shares in EasyJet (ESYJY) dropped over 8% in London after the airline cautioned that uncertainty over Brexit would hurt its summer sales.
“Macroeconomic uncertainty and many unanswered questions surrounding Brexit are together driving weaker customer demand in the market,” the company said in a statement.
Airlines across Europe have been put under pressure by weaker fares, a shortage of pilots, rising fuel costs and continued uncertainty over Britain’s departure from the European Union.
Last week, Icelandic carrier Wow Air halted operations after failing to secure new investment.
Lyft (LYFT)’s IPO on Friday was a success.
Shares in the company gained 8.7% in their debut to close at $78.29.
ICYMI: Lyft had priced its initial public offering at $72 a share, valuing the company at around $24 billion. That was above its original target range of $62 to $68 a share.
So who cashes in? Co-founders Logan Green and John Zimmer.
Other winners include General Motors (GM), Fidelity and Japanese e-commerce giant Rakuten (RKUNF).
What will Lyft look like as a public company? Our Sara Ashley O’Brien spoke to one group of people who may be facing an uncertain road ahead: its drivers. Read on here.
