Wall Street surges on hopes for stimulus, coronavirus vaccine
Floor traders work space is seen on the trading floor after the closing bell, following traders testing positive for Coronavirus disease (COVID-19), at the New York Stock Exchange (NYSE) in New York, U.S., March 19, 2020.
(Reuters) – Wall Street’s main indexes surged on Monday as encouraging early data from a potential coronavirus vaccine trial boosted sentiment, with investors also counting on more stimulus to rescue the economy from a deep slowdown.
Drugmaker Moderna Inc (MRNA.O) said its experimental COVID-19 vaccine showed promising results in a small early stage trial, boosting futures in premarket trading. Its own shares jumped 14%.
Investors have kept a close eye on vaccine programs of several drugmakers, cheering any positive development amid fears of a second wave of infections as governments start easing restrictions.ADVERTISEMENT
“If there really is a workable vaccine that can be mass produced, it really is a game changer for so many industries about which we weren’t so sure if the reopenings would solve their problems,” said Rick Meckler, a partner at Cherry Lane Investments in New Vernon, New Jersey.
Battered travel-related stocks such as cruise line operators Carnival Corp (CCL.N), Royal Caribbean Cruises Ltd (RCL.N), Norwegian Cruise Line Holdings Ltd (NCLH.N) jumped more than 10%, while the airlines subindex .SPCOMAIR also added 10.3%.
Markets were also encouraged by Federal Reserve Chair Jerome Powell’s remarks over the weekend on a gradual economic recovery and his affirmation that more monetary stimulus was on the way if required.
He had also stressed on the importance of a vaccine in establishing economic normalcy.
At 9:51 a.m. ET, the Dow Jones Industrial Average .DJI was up 757.31 points, or 3.20%, at 24,442.73, the S&P 500 .SPX was up 74.88 points, or 2.61%, at 2,938.58, and the Nasdaq Composite .IXIC was up 162.15 points, or 1.80%, at 9,176.71.
The benchmark S&P 500 was on track for its biggest one-day percentage gain in more than a month, with all the 11 major S&P sector indexes trading higher.ADVERTISEMENT
Energy stocks .SPNY soared 6.7% after oil prices surged on the prospect of higher demand as economic activity slowly resumes across the globe. [O/R]
General Motors Co (GM.N) rose 9.8% and Ford Motor Co (F.N) 6.9% as they prepared to reopen their North American factories in a push to restart work in an industry that accounts for about 6% of U.S. economic activity.
Advancing issues outnumbered decliners more than 13-to-1 on the NYSE and 7-to-1 on the Nasdaq.
The S&P index recorded 17 new 52-week highs and no new low, while the Nasdaq recorded 68 new highs and three new lows.
By Medha Singh and Ambar Warrick