US close: Stocks continue to rebound following Monday's sell-off

22 July 2021

(Sharecast News) - Wall Street stocks closed higher on Wednesday after major indices bounced back from an early week rout in the previous session.
At the close, the Dow Jones Industrial Average was up 0.83% at 34,798.00, while the S&P 500 was 0.82% firmer at 4,358.69 and the Nasdaq Composite saw out the session 0.92% stronger at 14,631.95.

The Dow closed 286.01 points higher on Wednesday, extending gains registered by the blue-chip index a day earlier.

Energy stocks were in focus on Wednesday as oil prices looked set to continue to bounce back from having dropped below $70 a barrel earlier in the week, as was the yield on the benchmark 10-year Treasury note, which moved up around five basis points to 1.26% after having dropped to a new five-month low on Monday.

In the corporate space, <strong>Coca-Cola</strong> raised its full-year revenue guidance amid a rebound in demand thanks to the reopening US economy, while drugmaker <strong>Johnson &amp; Johnson</strong> beat earnings estimates and said it now expects to see $2.5bn in global sales from its Covid-19 vaccine in 2021.

Elsewhere, <strong>Verizon</strong> reported a record second-quarter performance, with earnings per share of $1.40 and operating revenues of $33.8bn, and upwardly revised its full-year guidance, while <strong>Seagate</strong> also posted a quarterly earnings beat and revenues that topped forecasts.

<strong>Netflix</strong> shares were in the red after the streaming giant issued a disappointing forecast for full-year subscriber growth, while <strong>Chipotle</strong> stock was in the green after revealing quarterly revenues had surpassed pre-Covid levels.

On the macro front, mortgage applications declined 4.0% week-on-week in the seven days ended 16 July, according to the <em>Mortgage Bankers Association</em>, reflecting a 2.8% drop in applications to refinance existing loans and a 6.4% decrease in purchase applications to their lowest level since May 2020.

The decline also came as the average contract interest rate for traditional 30-year mortgages increased to 3.11% from 3.09%.