Monday Stock Market Update
The Dow Jones Industrial Average, S&P 500, and Nasdaq Composite surged on Monday.
- The Dow Jones Industrial Average gained 470.63 to close at 29,950.44.
- The S&P 500 gained 1.16 percent to close at 3,626.91.
- The Nasdaq Composite gained 0.80 percent to close at 11,924.13.
Early Monday, Moderna announced that its vaccine candidate was 94 percent effective in preventing contraction of COVID-19. Markets surged to all-time highs as investors hope that the world can get back to normal sooner than later.
“As we hear more positive news on the COVID-19 vaccine, the overblown work-from-home trade is beginning to unwind because some of those stocks had baked in no vaccine at all,” David Trainer, CEO of investment research firm New Constructs, said. “The rotation into value stocks that started last week will continue."
However, cases of COVID-19 continue to rise globally. The US recently surpassed 11 million cases and is closing in on 250,000 deaths.
“The story of the next few weeks will be a gradual and uneven—but unambiguous—tightening of anti-COVID restrictions across the country,” Ian Shepherdson, chief economist for Pantheon Macroeconomics, said Sunday. “The rapid rate of growth of cases and infections threatens to overwhelm the hospital system by the end of the year, at which point current trends suggest that perhaps 250K people will be hospitalized with Covid, with about 60K in ICUs.”
“Politicians, therefore, will have no choice but to respond to the unfolding nightmare in hospitals,” he added. “They will restrict activity in the leisure and hospitality sector— perhaps closing bars and restaurants completely in the hardest-hit cities—and by limiting indoor gatherings, in homes and elsewhere. These measures work, but they exact a real cost on the economy.”
On Tuesday keep an eye out for:
- Kohls, Home Depot, and Walmart are reporting earnings.