NEW YORK, July 16 — US stocks ended sharply higher yesterday, with the S&P 500 at its highest since early June, following promising early data for a potential Covid-19 vaccine and a strong quarterly report from Goldman Sachs.
Moderna Inc rallied 6.9 per cent after a small-scale study showed its experimental Covid-19 vaccine produced high levels of virus-killing antibodies.
Travel-related stocks Carnival Corp, Royal Caribbean Cruises Ltd, Marriott International and Wynn Resorts surged between 7 per cent and 21 per cent, and the S&P 1500 airlines index rallied over 10 per cent.
The S&P 500 beat the technology-heavy Nasdaq Composite for a fourth straight session, a feat scored only twice since Wall Street launched its massive recovery last March.
Gains for the Nasdaq were capped by online retail giant Amazon.com Inc, video streaming platform Netflix Inc and Microsoft Corp, which slipped after surging to record highs recently.
“The Moderna news woke everybody up again that this is not going to last forever, and there is light at the end of the tunnel. That is why you are seeing such a strong move today into those economically sensitive stocks,” said Tim Ghriskey, Chief Investment Strategist Inverness Counsel in New York.
Adding to investors’ enthusiasm, the Federal Reserve’s Beige Book survey showed US businesses saw an uptick in activity into the beginning of July as states eased restrictions to contain the novel coronavirus pandemic.
A raft of stimulus measures and encouraging economic data have lifted the S&P 500 to about 5 per cent below its record high hit in February.
However, the United States has failed to control the coronavirus and there is a high level of uncertainty over how much the pandemic will affect the economy, Philadelphia Federal Reserve Bank President Patrick Harker said, as a number of US sunbelt states reported a surge in Covid-19 cases recently.
Near the end of the trading session, US President Donald Trump said his administration had completed a top to bottom overhaul of the infrastructure approval process.
The Dow Jones Industrial Average rose 0.85 per cent to end at 26,870.03 points, while the S&P 500 gained 0.91 per cent to 3,226.55.
The Nasdaq Composite climbed 0.59 per cent to 10,550.49.
Goldman Sachs rose 1.4 per cent after it said its trading revenue doubled in the second quarter, driven by big swings in stock and bond markets since March.
Morgan Stanley and Bank of America gained nearly 2 per cent ahead of their results today. The broader banking index climbed 2.9 per cent.
UnitedHealth Group Inc fell 1.4 per cent after warning of rising costs later this year as Americans catch up on less urgent surgeries halted by the coronavirus pandemic.
Advancing issues outnumbered declining ones on the NYSE by a 5.23-to-1 ratio; on Nasdaq, a 4.31-to-1 ratio favoured advancers.
The S&P 500 posted 31 new 52-week highs and no new lows; the Nasdaq Composite recorded 78 new highs and three new lows.
Volume on US exchanges was 11.0 billion shares, compared with the 11.7 billion average for the full session over the last 20 trading days. — Reuters
