Vaccine progress, Yellen pick boost US stocks

·3-min read
Officials in the US are hopeful that they can begin offering virus vaccines within weeks, raising hopes of a return to normal life in 2021
Officials in the US are hopeful that they can begin offering virus vaccines within weeks, raising hopes of a return to normal life in 2021

Wall Street stocks gained Monday as another positive coronavirus vaccine announcement and optimism over Joe Biden's selection of Janet Yellen as Treasury Secretary offset worries about rising Covid-19 cases.

British drugs group AstraZeneca and the University of Oxford said they will seek regulatory approval for their coronavirus vaccine, adding to hopes that a post-pandemic economy could be in the offing following similar announcements by Pfizer/BioNTech and Moderna.

That was followed by news of Yellen's expected appointment at Treasury, confirmed to AFP by a financial source with knowledge of the decision made by Biden.

Yellen, the former head of the Federal Reserve, is a known quantity on financial markets and "has been favorable to the idea of fiscal stimulus," said Gregori Volokhine of Meeschaert Financial Services.

These developments countered news of fresh coronavirus restrictions in Los Angeles and Nevada.

Major US indices finished solidly higher, with the S&P 500 gaining 0.6 percent.

Earlier, European equity markets pulled back, dented by a downcast survey of European economic activity from IHS Markit.

The firm's closely watched PMI index plummeted to 45.1 points from 50.0 points in October, well below the key 50-point level which indicates growth.

"The eurozone economy has plunged back into a severe decline in November amid renewed efforts to quash the rising tide of COVID-19 infections," said Chris Williamson, chief economist at IHS Markit.

Oil prices pushed higher on optimism over vaccines.

"The thought of starting a vaccination campaign already within 2020 revitalized trader hopes that oil demand could take a little less time to recover," said Bjornar Tonhaugen of consultancy Rystad Energy.

"As oil demand is currently expected to take a hit from the second global round of lockdowns, the early vaccine news are offer some light in the tunnel."

Among individual companies, Boeing surged 6.0 percent after European Union Aviation Safety Agency chief Patrick Ky said he expects the Boeing 737 MAX to return to service in January following agency safety reviews.

The statement comes only days after US air safety regulators approved the jet to return to service.

US retailers had a good session on optimism about the upcoming holiday shopping season, with Macy's gaining 15.0 percent, Gap 6.9 percent and Best Buy 2.4 percent.

- Key figures around 2150 GMT -

New York - Dow: UP 1.1 percent at 29,591.27 (close)

New York - S&P 500: UP 0.6 percent at 3,577.59 (close)

New York - Nasdaq: UP 0.2 percent at 11,880.63 (close)

London - FTSE 100: DOWN 0.3 percent at 6,333.84 (close)

Frankfurt - DAX 30: DOWN 0.1 percent at 13,126.97 (close)

Paris - CAC 40: DOWN 0.1 percent at 5,492.15 (close)

EURO STOXX 50: DOWN 0.1 percent at 3,463.04 (close)

Hong Kong - Hang Seng: UP 0.1 percent at 26,486.20 (close)

Shanghai - Composite: UP 1.1 percent at 3,414.49 (close)

Tokyo - Nikkei 225: Closed for a holiday

Euro/dollar: DOWN at $1.1846 from $1.1857 at 2200 GMT

Pound/dollar: UP at $1.3325 from $1.3275

Dollar/yen: UP at 104.54 yen from 103.86 yen

Euro/pound: DOWN at 88.86 pence from 89.25 pence

West Texas Intermediate: UP 1.5 percent at $43.06 per barrel

Brent North Sea crude: UP 2.4 percent at $46.06 per barrel

dan-jmb/cs