(Barron’s) The U.S. stock market is closed for Memorial Day. That hasn’t stopped the Dow Jones Industrial Average from rallying strongly.
How is that possible?
While the markets in the U.S. are closed, it’s business as usual for others. That means index futures are trading, and we can extrapolate from them where the actual indexes would be.
Dow futures have gained 262 points, implying a 276.45 points, or 1.1% rise for the blue-chip benchmark if it were trading, while S&P 500 futures have gained 33.10 points, implying a 1.2% rise for the index. Nasdaq Composite futures point to a 1.2% gain for the tech-heavy benchmark, while the Russell 2000 would be up 1.6%.
Finding a reason for the market’s gain is another story. There’s strength in both Japan, where the Nikkei 225 has gained 1.7%, and in Germany, where the DAX is up 2.5% after Germany’s Ifo business sentiment index came in stronger than expected due to a strong increase in future expectations.
Otherwise, it is grasping for straws.
NatAlliance Securities’ Andrew Brenner, for instance, offered up five reasons for the rally, including: the aforementioned German sentiment index; the fact that Chinese and Hong Kong stocks have stopped tumbling; a Bloomberg article about there being no alternative to stocks; the reopening of cities and countries world-wide, including Tokyo; and Face the Nation’s segment with Eric Rosengren, who said that the Federal Reserve would be ready to start helping small businesses this week.