U.S. markets and stock exchange traded funds rose Monday, with the technology sector leading the charge as promising developments in a coronavirus vaccine helped counteract growing concerns over a resurgence in infections.
On Monday, the Invesco QQQ Trust (NASDAQ: QQQ) was up 1.9%, SPDR Dow Jones Industrial Average ETF (NYSEArca: DIA) dropped 0.1%, and SPDR S&P 500 ETF (NYSEArca: SPY) gained 0.5%.
Amazon.com (NasdaqGS: AMZN) was among the standouts in the tech-heavy Nasdaq after two brokerages upgraded their price targets on the e-commerce giant, Reuters reports.
Meanwhile, U.S. drugmaker Pfizer (PFE) and German biotech firm BioNTech (BNTX) revealed optimistic data from their experimental COVID-19 treatments that showed it was safe to use and triggered an immune response in patients.
Additionally, in the United Kingdom, an experimental vaccine being developed by AstraZeneca and Oxford University generated an immune response in early-stage clinical trials.
“Even though we had some good vaccine news, the Phase-3 trials for many of these things is the hardest part and is very difficult to get through,” Elliott Savage, portfolio manager of the YCG Enhanced Fund, told Reuters. “At this point, the fiscal stimulus is the next thing on investors’ minds. If there were a big audacious kind of fiscal stimulus package, then that could definitely cause the market to move higher.”
Looking ahead, Congress will debate on a new aid package this week as some aspects of the previous support package is set to expire at the end of the month, notably the enhanced unemployment benefits that has helped prop up consumer spending in recent months.
The U.S. continues to see record levels of new Covid-19 infections, which has forced many states to rollback reopening plans with some even warning of reinstating lockdown measures.
“You can’t have case numbers and economic activity rising at the same time. Something has to give,” Seema Shah, chief strategist at Principal Global Investors, told the Wall Street Journal. “We’ve shifted to a point where the market might take a regional lockdown in the U.S. as a positive sign because it would be seen that officials are taking it seriously.”
For more information on the markets, visit our current affairs category.