The Dow hit a record Monday after Moderna became the second American company in a week to report positive results from its COVID-19 vaccine test, raising hopes for a faster economic recovery from a recession led by a pandemic.
Moderna Inc soared 7.7% as it said its experimental vaccine was 94.5% effective in preventing COVID-19 based on interim data from a late-stage trial.
The Nasdaq’s rise was limited as investors sold some of this year’s “stay-at-home” winners, including Amazon.com Inc, Netflix Inc and Zoom Video Communications Inc.
The S&P 500 and Dow headed to all-time closing highs, building on last week’s gains after a similar vaccine-related update from Pfizer Inc illuminated the economic outlook and triggered a turnover in value and cyclical stocks.
“It is not the end of the virus problem, but it is the first sign of the beginning of the end, which is always taken as a positive sign,” said Randy Frederick, vice president of commerce and derivatives at Charles Schwab in Austin, Texas.
“We won’t get a real impact from this until the vaccine is manufactured and widely distributed, which probably won’t happen until the first quarter of next year.”
Travel-related stocks, including United Airlines Holdings Inc, American Airlines Group Inc, Carnival Corp and Norwegian Cruise Line Holdings Ltd, which have lost more than half of their market capitalization this year due to the pandemic, increased by 5, 0% and 11.4%.
Bets on a working COVID-19 vaccine boosted gains on Wall Street last week, helping investors look beyond the rising coronavirus cases in the United States that passed the 11 million mark – a little bit. more than a week after reaching 10 million.
At 11:35 a.m. ET, the Dow Jones Industrial Average rose 443.68 points, or 1.51%, to 29,923.49, the S&P 500 gained 38.61 points, or 1.08%, to 3,623.76 and the Nasdaq Composite gained 75.21 points, or 0.64%, to 11,904.49.
The Russell 2000 Index rose as much as 2.2% to a daily intraday high. S & P’s energy sector rose 5.4%, while financial stocks reached their highest level in eight months.
Value stocks, which include banks and energy stocks and tend to outperform coming out of a recession, added about 1.6%, while growth stocks, which are weighted by technology, increased by 0, 5%.
“When people look to places other than traditional leading sectors to do business like healthcare, finance, it speaks of greater trust overall,” said Frederick.
Among other moves, Simon Property Group Inc jumped 6% after the largest U.S. mall operator cut the purchase price of an 80% stake in rival Taubman Centers Inc as the virus outbreak upsets the retail industry.
Forward issues outnumbered declining issues 4.6 to 1 on the NYSE; on the Nasdaq, a 2.7-to-1 ratio favored those advancing.
The S&P 500 posted 35 new 52-week highs and no new lows, while the Nasdaq Composite posted 202 new highs and 11 new lows.
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