Wall Street surges on hopes for stimulus, coronavirus vaccine

FILE PHOTO: 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./File Photo

BY MEDHA SINGH AND AMBAR WARRICK/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.

“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.

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.

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