Monday, 18 Jan 2021

Vaccine optimism propels Nasdaq to record high

(Reuters) – The Nasdaq Composite hit an all-time high on Thursday as investors stayed focused on a COVID-19 vaccine and looked beyond bleak economic data, while Boeing Co lifted the Dow Jones Industrial Average.

FILE PHOTO: The front facade of the New York Stock Exchange (NYSE) is seen in New York, U.S., November 24, 2020. REUTERS/Brendan McDermid/File Photo

The S&P 500 bounced between a slight loss and a slight gain after hitting a record high.

Boeing jumped over 7% after budget airline Ryanair ordered 75 additional 737 MAX jets with a list price of $9 billion, throwing a commercial lifeline to the embattled U.S. planemaker.

Tesla Inc surged 5% and drove the Nasdaq higher after Goldman Sachs upgraded the stock to “buy” in the run-up to the electric car maker’s addition to the S&P 500.

Data showed the number of Americans filing first-time claims for jobless benefits fell last week, but remained extraordinarily high at 712,000, while a separate survey showed U.S. services industry activity slowed to a six-month low in November.

“I don’t think we will see those numbers start to get back to normal until we start to see a rollout of a vaccine,” said Sal Bruno, chief investment officer at IndexIQ. “The market is discounting that and saying we are looking forward to the first or second quarter and a rollout of the vaccine to the general population.”

U.S. Senate Majority Leader Mitch McConnell cited some positive movement in congressional efforts to reach a compromise on a new coronavirus aid bill but gave no hints on when such a deal could be struck.

Progress in developing a working COVID-19 vaccine before the end of the year has driven the Wall Street’s main indexes to record levels in recent days. Despite the economic destruction caused by the pandemic, the S&P 500 has gained 14% in 2020.

The Dow Jones Industrial Average was up 0.42% at 30,008.19 points, while the S&P 500 gained 0.04% to 3,670.36.

The Nasdaq Composite added 0.36% to 12,394.21.

Five of the 11 major S&P 500 sector indexes rose, energy up 2% and leading gains.

Ongoing vaccine optimism helped lift the S&P 1500 airlines index 6%. Cruise operators Carnival Corp jumped 10% and Norwegian Cruise Line Holdings Ltd surged 9%.

Cloud-security provider Zscaler Inc surged 23% after it reported better-than-expected first-quarter revenue and adjusted profit.

Waddell & Reed Financial surged 50%, extending gains from the previous session, after Australia’s Macquarie Group announced a deal to buy the wealth manager for $1.7 billion.

Advancing issues outnumbered decliners on the NYSE by a 2.59-to-1 ratio; on Nasdaq, a 1.95-to-1 ratio favored advancers.

The S&P 500 posted 32 new 52-week highs and no new lows; the Nasdaq Composite recorded 154 new highs and six new lows.

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