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Wall St set to rise as vaccine progress fuels recovery hopes

Wall St set to rise as vaccine progress fuels recovery hopes

FILE PHOTO: The New York Stock Exchange (NYSE) is seen as people walk in silhouette in the financial district of New York, U.S., November 19, 2020. REUTERS/Shannon Stapleton/File Photo

REUTERS: Wall Street's main indexes were set to rise on Monday as hopes that the first COVID-19 vaccine could be available within weeks renewed bets of a swift economic recovery next year.

The U.S. Food and Drug Administration is likely to approve in mid-December the distribution of the vaccine made by Pfizer Inc and German partner BioNTech, a top official of the government's vaccine development effort said on Sunday.

Global equity markets received a boost earlier on Monday as AstraZeneca Plc became the latest major drugmaker to say its COVID-19 vaccine could be around 90per cent effective, although its shares fell 1.9per cent as some traders perceived the efficacy data as disappointing compared with rivals.

"There's good news on the coronavirus vaccine and that's building a lot of enthusiasm in a short trading week, but the enthusiasm might be getting a little bit overdone," said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.

"It isn't like the vaccine is going to be distributed tomorrow. It's going to take at least a month and so we are still pretty far away before reality sets in."

At 8:31 a.m. ET, Dow e-minis were up 170 points, or 0.58per cent, S&P 500 e-minis were up 19.25 points, or 0.54per cent, and Nasdaq 100 e-minis were up 39 points, or 0.33per cent.

Market participants warned of higher volatility in a trading week shortened by the Thanksgiving holiday on Nov. 26.

Evidence of high efficacy rates in experimental vaccines had lifted the S&P 500 to a record high earlier this month and sparked demand for stocks such as industrials, energy and banks, sending the S&P value index up more than 10per cent.

By contrast, the growth index, which comprises heavyweight technology stocks, has risen less than 8per cent in November after leading Wall Street's recovery from its coronavirus lows.

But traders are again turning cautious about the economic damage from the coronavirus-led restrictions to contain a surge in infections.

After data last week signaled a faltering labor market recovery, flash readings of business activity surveys due later in the day are expected to show the manufacturing and services sectors expanded at a slower pace in November.

Meanwhile, hopes of more monetary stimulus were dashed after Treasury Secretary Steven Mnuchin last week pulled the plug on some of the Federal Reserve's pandemic emergency lending programs.

In company news, shares of drugmaker Regeneron Pharmaceuticals Inc jumped 3.6per cent in premarket trading after the FDA on Saturday granted emergency use authorization to its COVID-19 antibody therapy.

Merck & Co Inc rose 1.8per cent after agreeing to acquire OncoImmune in a deal that will give it control of a drug that could help ease symptoms and reduce deaths in patients with severe or critical cases of COVID-19.

(Reporting by Sagarika Jaisinghani and Shivani Kumaresan in Bengaluru; Editing by Arun Koyyur)

Source: Reuters

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