Moderna Inc surged 9.2% after a small-scale study showed its experimental COVID-19 vaccine produced high levels of virus-killing antibodies.
Travel-related stocks Carnival Corp, Royal Caribbean Cruises Ltd, Marriott International and Wynn Resorts rose between 7% and 20%, with the S&P 1500 airlines index up 10.0%.
The S&P 500 was on track to beat the technology-heavy Nasdaq Composite for a fourth straight session, a feat scored only twice since Wall Street launched its massive recovery last March.
Gains for the Nasdaq were capped by online retail giant Amazon.com Inc, video streaming platform Netflix Inc and Microsoft Corp which slipped after surging to record highs recently.
“The Moderna news woke everybody up again that this is not going to last forever, and there is light at the end of the tunnel. That is why you are seeing such a strong move today into those economically sensitive stocks,” said Tim Ghriskey, Chief Investment Strategist Inverness Counsel in New York.\
Adding to investors’ enthusiasm, the Federal Reserve’s Beige Book survey showed U.S. businesses saw an uptick in activity into the beginning of July as states eased restrictions to contain the novel coronavirus pandemic, but that but many were uncertain about the economic outlook.
However, the United States has failed to control the coronavirus and there is a high level of uncertainty over how much the pandemic will affect the economy, Philadelphia Federal Reserve Bank President Patrick Harker said, as a number of U.S. sunbelt states reported a surge in COVID-19 cases recently.
The three main U.S. stock indexes have recouped most of their losses from the coronavirus-led slump, with a raft of stimulus measures and encouraging economic data lifting the S&P 500 to about 5% below its record high hit in February.
At 2:28 p.m. ET (1828 GMT), the Dow Jones Industrial Average was up 0.79% at 26,854.26 points, while the S&P 500 gained 0.94% to 3,227.45.
The Nasdaq Composite added 0.66% to 10,558.29.
Goldman Sachs rose 1.2% after it said its trading revenue doubled in the second quarter, driven by big swings in stock and bond markets since March.
Morgan Stanley gained 1.2% and Bank of America rose 1.4% ahead of their results on Thursday. The broader banking index climbed 2.3%.
UnitedHealth Group Inc fell 2.3% after warning of rising costs later this year as Americans catch up on less urgent surgeries halted by the coronavirus pandemic.
Advancing issues outnumbered declining ones on the NYSE by a 5.03-to-1 ratio; on Nasdaq, a 4.35-to-1 ratio favored advancers.
The S&P 500 posted 29 new 52-week highs and no new lows; the Nasdaq Composite recorded 67 new highs and two new lows.
Additional reporting by Medha Singh and Devik Jain in Bengaluru; Editing by Marguerita Choy
Our Standards:The Thomson Reuters Trust Principles.
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