NEW YORK, RAW – Wall Street has rallied and the Nasdaq reached an all-time closing high as sentiment was boosted by full FDA approval of a COVID-19 vaccine and market participants looked ahead to the Jackson Hole Symposium expected to convene later this week.
All three major US stock indexes ended the session sharply higher on Monday, with surging crude prices, driven by expected demand growth, putting energy shares out front.
“This has been the script all along,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York. “We make new highs, pull back, and then we’re off to the races again.”
“That tells me the fundamentals are in place,” Cardillo added. “There’s worries out there, but it’s hard to keep this market down.”
The US Food and Drug Administration (FDA) granted full approval to the COVID-19 vaccine developed by Pfizer Inc and BioNTech SE in a move that could accelerate inoculations in the United States.
“Full approval means that there’s most likely going to be more mandates, more companies will mandate that you have to get the vaccine in order to get back to the office,” Cardillo said. “I don’t think this will get all the doubters vaccinated but this news today will probably drive (the vaccinated rate) closer to 75 per cent.”
Pfizer and US-listed shares of BioNTech advanced, as did rival Moderna Inc.
Spiking COVID-19 infections caused by the highly contagious Delta variant have fueled concerns over a protracted recovery from the global health crisis.
Data released on Monday painted a mixed portrait of an economy inching back to normal in the wake of the most abrupt contraction in history.
Sales of pre-owned homes unexpectedly increased in July, according to the National Association of Realtors, while a report from IHS Markit showed business activity accelerating this month.
The “Goldilocks” portrait of an economic recovery headed in the right direction, but not robust enough to warrant a change in the Federal Reserve’s dovish monetary policy, helped feed investor risk appetite.
Market participants look to the Jackson Hole Symposium, due to convene in Wyoming later this week. Fed Chairman Jerome Powell’s comments will be closely parsed for clues regarding the central bank’s policy-tightening timeline.
Unofficially, the Dow Jones Industrial Average rose 215.63 points, or 0.61 per cent, to 35,335.71, the S&P 500 gained 37.84 points, or 0.85 per cent, to 4,479.51 and the Nasdaq Composite added 227.99 points, or 1.55 per cent, to 14,942.65.
Surging crude prices pushed the energy sector to its best day in nearly two months.
Exxon Mobil Corp and Chevron Corp also gained on the day.
US-listed shares of Trillium Therapeutics Inc soared after Pfizer agreed to buy the cancer drug developer in a $US2.26 billion ($A3.15 billion) deal.
General Motors Co fell following its announcement that it would take a $US1 billion ($A1.4 billion) hit to expand the recall of its Chevrolet Bolt electric vehicles.