Positive results from another COVID-19 vaccine study boosted US stocks on Monday as infections mount across the country.
The Dow and S&P 500 indices rebounded Monday after Moderna said preliminary trial data showed the COVID-19 vaccine is 94.5 percent effective – the second promising announcement from the vaccine front in as many weeks .
The Dow Jones Industrial Average rose more than 364 points, or 1.23 percent, when Wall Street opened, bringing the 30-share index within striking distance of the 30,000 mark.
The broader S&P 500 index – an indicator of the health of U.S. retirement and college savings accounts – rose 0.76 percent on opening after closing a new record on Friday.
The Nasdaq Composite Index has since opened virtually unchanged as investors continued to ditch Big Tech in favor of stocks that were hit by the pandemic.
Moderna shares rose 10.47 percent in the first few minutes of trading after the biotech became the second US company to report positive results from studies with its COVID-19 vaccine candidate.
Last week, Pfizer Inc reported that data from late studies of the vaccine it is developing with BioNTech in Germany showed greater than 90 percent effectiveness.
The double dose of good news raises hope that a game changer is in sight to beat the pandemic and get the US and global economies on the path to “normalize”.
“After nearly a year of COVID-19 devastating the global economy, there is finally light at the end of the tunnel,” wrote Neil Shearing, Group Chief Economist at Capital Economics, in a Monday note.
Shearing also warned that the current optimism could be short-lived as economies grapple with rising infection rates.
“The good news about vaccines is tempered by the fact that it doesn’t come soon enough to prevent a difficult winter for many economies,” Shearing said.
According to the Johns Hopkins University, infections in the US continue to rise, with confirmed COVID-19 infections topping the 11 million mark over the weekend.
The wave has resulted in more business restrictions nationwide as state and local authorities seek to contain the spread of the disease.
The UK, along with Germany, France and other European nations, have also reintroduced lockdown measures to contain spiral infections.
Members of Mesa Place Church pray outside El Paso University Medical Center during the coronavirus outbreak in El Paso, Texas, USA [File: Ivan Pierre Aguirre/Reuters]In Pfizer’s news last Monday, investors switched from big tech and other “stay-at-home” stocks to snagging stocks of companies brutalized by the pandemic, such as airlines, financial companies, and cruise and theater operators.
Among other stocks that hit the headlines on Monday:
Inovio Pharmaceuticals also gained 7.21 percent after the U.S. FDA approved an interim study on its COVID-19 vaccine candidate.
Johnson & Johnson shares rose 0.45 percent after a new study started to test its own experimental COVID-19 vaccine.
The shares of Simon Property Group Inc, the largest mall operator in the United States, rose 6.84 percent after the purchase price for an 80 percent stake in rival Taubman Centers Inc. was lowered. The pandemic has decimated retail.