US stocks-S&P 500, Nasdaq up as tech stocks rise after J&J vaccine pause

In this file photo taken on March 5, 2021 registered nurse Florisa N. Lingad holds a Johnson & Johnson Janssen Covid-19 vaccine at a vaccination center established at the Hilton Chicago O'Hare Airport Hotel in Chicago, Illinois. — AFP pic
In this file photo taken on March 5, 2021 registered nurse Florisa N. Lingad holds a Johnson & Johnson Janssen Covid-19 vaccine at a vaccination center established at the Hilton Chicago O'Hare Airport Hotel in Chicago, Illinois. — AFP pic

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APRIL 13 — The S&P 500 and the Nasdaq rose today as investors flocked to the perceived safety of technology-related stocks as the US pause in the rollout of Johnson & Johnson’s Covid-19 vaccine sparked fears of a delay in a broader economic rebound.

The drugmaker’s shares fell 2.2 per cent to a one-month low as US federal health agencies recommended pausing the use of its Covid-19 vaccine after six women developed rare blood clots, dealing a fresh setback to efforts to tackle the pandemic.

Technology and consumer discretionary sectors, which house high-flying technology names that tend to outperform during times of economic uncertainty, rose 0.6 per cent and 0.4 per cent, respectively.

The news also helped Wall Street’s main indexes shrug off a solid jump in the consumer price index (CPI) in March, kicking off what most economists expect will be a brief period of higher inflation.

“While the jump in CPI is pretty significant, the market may take it with a grain of salt – it could already be priced in as the market has been skittish about rates for some time,” said Mike Loewengart, managing director at investment strategy at E*TRADE Financial.

“The real curveball today is the J&J vaccine halt, although this too may be shrugged off as a minor setback. While this may cause some short-term volatility, investors have been pretty steadfast in their faith in a full economic recovery.”

White House economic adviser Jared Bernstein said it was too soon to say what impact the pause could have on President Joe Biden’s push to reopen the country.

Shares of rival US vaccine makers Pfizer Inc and Moderna Inc rose 0.6 per cent and 7.1 per cent.

At 10:24 a.m. ET, the Dow Jones Industrial Average was down 109.87 points, or 0.33 per cent, at 33,635.53, the S&P 500 was up 3.60 points, or 0.09 per cent, at 4,131.59, and the Nasdaq Composite was up 81 points, or 0.58 per cent, at 13,931.

Heavyweight tech-related companies, which had flourished during the lockdowns last year, rose on Tuesday with Apple Inc , Microsoft Corp and Amazon.com Inc gaining between 0.5 per cent and 0.8 per cent.

Meanwhile, cruise operators, airlines and hotel chains that are poised to benefit from an economic reopening, driven by vaccine distributions, edged lower.

The first-quarter earnings season is set to take center stage this week, with results from Goldman Sachs, JPMorgan and Wells Fargo due on Wednesday.

Analysts expect earnings for S&P 500 firms to have jumped 25 per cent from a year earlier, driven by strength in consumer discretionary and financial companies, according to Refinitiv IBES data.

Cryptocurrency and blockchain-related firms Riot Blockchain jumped 7.6 per cent and Marathon Digital Holdings added 5.7 per cent as bitcoin prices soared 5 per cent, a day ahead of listing of Coinbase, the largest US cryptocurrency exchange.

Declining issues outnumbered advancers for a 1.56-to-1 ratio on the NYSE and a 1.50-to-1 ratio on the Nasdaq.

The S&P index recorded 27 new 52-week highs and one new low, while the Nasdaq recorded 30 new highs and 55 new lows. — Reuters

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