Another record day on Wall Street as the S&P 500 and the Dow hit new all-time closing highs on news of another promising coronavirus vaccine, offsetting surging infections and new shutdowns which threaten to hobble a recovery from the pandemic recession.
The Dow hit a series of intraday highs and flirted with the 30,000 mark while the S&P 500 ended at a record close for a second day in a row.
Value, cyclical and small-cap shares, which stand to benefit most from an economic rebound, outperformed the broader market as the rotation out of megatechs continued.
The big driver though was the news (for a second Monday in a row) of another apparently highly successful COVID-19 vaccine.
Last week it was Pfizer and its German partner with a vaccine that showed a 90% success rate in trial. Yesterday it was Moderna Inc which said its COVID-19 vaccine was 94.5% effective in preventing infection based on interim late-state data.
The good news though can’t come fast enough as US COVID-19 infection rates topped 11 million with 40 US states reporting record infection numbers, prompting more and more governments to restrict activity and ve to lockdowns of varying severity.
Travel-related stocks, which were hammered by lockdowns and restrictions enacted to contain the pandemic’s spread, were in demand.
Shares of United Airlines Holdings, American Airlines Group, Carnival Corp and Norwegian Cruise Line jumped between 3.4% and 8.3%.
But that could be false hope, despite the promising vaccine news more American states are heading for lockdowns and more restrictions heading into winter, Christmas and then New Year (which is a big cruising and travel season).
The Dow surged in the last minutes to close up 470 points or 1.6% at a record 29,950.44, the S&P 500 jumped 41.76 points, or 1.16%%, to end at a record 3,626.913 and the Nasdaq added 94.84 points, or 0.80%, at finish at 11,924.13.
Oil rose, gold was higher but fell in after hours trading, the Aussie dollar though jumped back over 73 US cents and was around 73.18 at 8am – the highest since early January.
