Dow Rides Vaccine Optimism to Record High

Dow Rides Vaccine Optimism to Record High

Investing.com  | Nov 16, 2020 18:25

Dow Rides Vaccine Optimism to Record High

By Yasin Ebrahim

Investing.com - The Dow rallied Monday, as positive Covid-19 vaccine news boosted expectations for a quicker economic recovery, prompting investors to up their bets on stocks linked to the progress of the economy.

The Dow Jones Industrial Average rose 1.24%, or 365 points. The S&P 500 was up 0.75%, while the Nasdaq Composite added 0.40%.

Moderna (NASDAQ:MRNA) on Monday said its coronavirus vaccine candidate was 94.5% effective at protecting people from the disease, sending its shares more than 9% higher. The company said detailed data from the study was expected later in November, and added that it planned to request emergency use of its vaccine by early December.

The update added to the recent optimism in the race to find a vaccine after Pfizer Inc (NYSE:PFE) last week said its vaccine candidate was proven to 90% effective in a clinical trial.  

Airlines, banks, and cruise operators – sectors hit hard by the pandemic amid global restrictions to curb the virus – racked up gains, propelling the broader market higher.

Delta Air Lines (NYSE:DAL) rose 3%, United Airlines (NASDAQ:UAL), and American Airlines Group (NASDAQ:AAL) were up more than 5%.

Energy, meanwhile, surged on rising oil prices as a speedier end to the pandemic could shore up demand.

Exxon Mobil Corp and Chevron (NYSE:CVX), (NYSE:XOM) jumped more than 5%.

Tech, meanwhile, also contributed to the broader move higher as gains in chip stocks, led by Micron, helped offset mixed performance in the Fab 5.

Micron Technology (NASDAQ:MU) jumped nearly 5% on bets the rapid increase in digital transformation will continue to support the rebound in demand for memory chips after a recent glut had weighed on prices.

Apple (NASDAQ:AAPL), and Amazon.com (NASDAQ:AMZN) were about unchanged on the day, while Facebook (NASDAQ:FB), Alphabet (NASDAQ:GOOGL) and Microsoft  (NASDAQ:MSFT) traded mixed.

The positive vaccine news, however, dealt a blow to stay at home stocks including Peloton Interactive (NASDAQ:PTON) and Zoom Video Communications (NASDAQ:ZM), with the latter down more than 3%

In other news, HD Supply (NASDAQ:HDS) jumped more than 24% after Home Depot (NYSE:HD) agreed to acquire the industrial goods wholesaler for $8.7 billion. Home previously sold HD Supply to private-equity firms in 2007.

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