US STOCKS-Dow hits record high as Moderna data bolsters vaccine bets

  • Reuters
  • Stock Market News
US STOCKS-Dow hits record high as Moderna data bolsters vaccine bets
Credit: © Reuters.

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* Moderna jumps after COVID-19 vaccine update; Pfizer falls

* Banks, airlines, cruise operators rally

* "Stay-at-home" winners Netflix, Amazon fall

* Indexes up: Dow 1.5%, S&P 1.1%, Nasdaq 0.6% (Adds comment, details; Updates prices)

By Medha Singh and Shivani Kumaresan

Nov 16 (Reuters) - The Dow hit a record high on Monday after Moderna became the second U.S. company in a week to report positive results from its COVID-19 vaccine trial, raising hopes of a quicker economic recovery from a pandemic-led recession.

Moderna Inc MRNA.O soared 7.7% as it said its experimental vaccine was 94.5% effective in preventing COVID-19 based on interim data from a late-stage trial. Nasdaq's .IXIC rise was limited as investors sold some of this year's "stay-at-home" winners such as Amazon.com Inc AMZN.O , Netflix Inc NFLX.O and Zoom Video Communications Inc ZM.O .

The S&P 500 and the Dow headed for record closing highs, building on gains from last week after a similar vaccine-related update from Pfizer Inc (NYSE: PFE ) PFE.N brightened the economic outlook and sparked a rotation into cyclical and value shares.

"It's not the end of the virus issue, but it's the first sign of the beginning of the end which is always taken as a positive sign," said Randy Frederick, vice president of trading and derivatives for Charles Schwab (NYSE: SCHW ) in Austin, Texas.

"We won't get a true impact from this until the vaccine is manufactured and distributed widely, which probably won't happen until Q1 next year."

Travel-related stocks including United Airlines Holdings Inc UAL.O , American Airlines Group Inc AAL.O , Carnival Corp (LON: CCL ) CCL.N and Norwegian Cruise Line Holdings Ltd NCLH.N , which have lost more than half their market capitalization this year due to the pandemic, jumped between 5.0% and 11.4%.

Bets of a working COVID-19 vaccine fueled gains on Wall Street last week, helping investors look past surging coronavirus cases across the United States which topped the 11 million mark, just over a week after hitting 10 million. 11:35 a.m. ET the Dow Jones Industrial Average .DJI rose 443.68 points, or 1.51%, to 29,923.49, the S&P 500 .SPX gained 38.61 points, or 1.08%, to 3,623.76 and the Nasdaq Composite .IXIC gained 75.21 points, or 0.64%, to 11,904.49.

The Russell 2000 index .RUT rose as much as 2.2% to a daily intraday peak. The S&P energy sector .SPNY jumped 5.4%, while financial stocks .SPSY were at their highest in eight months.

Value shares .RLV , that comprise banks and energy stocks and tend to outperform coming out of a recession, added about 1.6%, while growth shares .RLG , which are technology weighted, were 0.5% higher.

"When people look for places other than the traditional leading sectors for bargains such as healthcare, financials, it speaks of an improved confidence overall," Frederick said.

Among other movers, Simon Property Group Inc (NYSE: SPG ) SPG.N jumped 6% after the biggest U.S. mall operator cut its purchase price for an 80% stake of rival Taubman Centers Inc TCO.N , as the virus outbreak upends the retail industry. issues outnumbered decliners by 4.6-to-1 on the NYSE; on the Nasdaq, a 2.7-to-1 ratio favored advancers.

The S&P 500 posted 35 new 52-week highs and no new low, while the Nasdaq Composite recorded 202 new highs and 11 new lows.

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