S&P 500 Rises 20% in Q2... Largest Increase in 22 Years (Comprehensive)

[Image source=Reuters Yonhap News]

[Asia Economy New York=Correspondent Baek Jong-min] The New York stock market ended the first half of 2020 on a high note.

On the 30th (local time), the Dow Jones Industrial Average rose 217.08 points (0.85%) to close at 25,812.88, the S&P 500 index increased 47.05 points (1.54%) to 3,100.29, and the Nasdaq index gained 184.61 points (1.87%) to finish at 10,058.77.

Despite the negative factor of the resurgence of the novel coronavirus disease (COVID-19), the market focused on economic indicators and the congressional testimonies of Jerome Powell, Chairman of the Federal Reserve (Fed), and Steven Mnuchin, Secretary of the Treasury.

The New York stock market showed mixed trends shortly after opening but gained momentum about an hour before closing, boosting expectations for the second half of the year.

After experiencing the worst plunge in the first quarter, the New York stock market made a spectacular comeback in the second quarter. The S&P 500 index rose nearly 20% in the second quarter, marking the largest quarterly gain since 1998. The Dow also surged 17.8%, setting the largest quarterly increase record since 1987. The Nasdaq jumped 30.6%, closing the quarter near its all-time high.

On the same day, Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases (NIAID) under the U.S. National Institutes of Health, expressed concern that the daily number of new COVID-19 cases in the U.S. could soar to 100,000. CNN reported that 16 states have halted economic reopening.

In this situation, investment bank Goldman Sachs estimated that enforcing mandatory mask-wearing could prevent a 5% decline in U.S. Gross Domestic Product (GDP). This suggests masks as a way to mitigate the economic impact of the COVID-19 spread.

The economic indicators released that day were positive. The Conference Board's Consumer Confidence Index for June rose from 85.9 in the previous month to 98.1. The Chicago Purchasing Managers' Index (PMI) for June increased from 32.3 to 36.6, though it fell short of the market expectation of 45.5.

Secretary Mnuchin's testimony to the House of Representatives that the Trump administration aims to pass additional fiscal stimulus measures by the end of July was also a positive factor.

Despite U.S.-China tensions over the Hong Kong National Security Law issue, Mnuchin said, "We have every expectation that China will comply with the Phase One trade agreement," calming market concerns.

August delivery West Texas Intermediate (WTI) crude oil closed at $39.27, down 1.1% (43 cents) from the previous day. WTI also rose about 90% in the second quarter, marking the highest quarterly level in approximately 30 years.

International gold prices surpassed $1,800 per ounce. Gold rose 1.1% (19.30 dollars) from the previous day to $1,800.50 per ounce.