Shares soar as traders eye stimulus, vaccines

Stocks rose Tuesday as more updates on the stimulus front out of Washington helped at least temporarily offset concerns over the potential for more virus-related restrictions.

The S&P 500 extended its gains to 1.3% around 2:30 p.m. in New York, after the index logged a fourth straight session of declines a day earlier. The Dow rose more than 350 points, or 1.2%, and the Nasdaq increased 1%.

COVID-19 cases and hospitalizations continued to march higher across the U.S., and the country crossed the grim milestone of 300,000 total COVID-related deaths on Monday. In New York City, Mayor Bill de Blasio warned that the city should brace for a second full shutdown if the current rate of new cases and hospitalizations continues.

Though the first batch of Pfizer’s (PFE) vaccine started getting distributed this week, Americans are still set to contend with the virus for at least the next several months as drugmakers produce and ship the inoculations across the country and the world. The Food and Drug Administration released data from its review of the Moderna (MRNA) COVID-19 vaccine that confirmed the drugmaker’s vaccine efficacy rate of 94.1% as had widely been expected, setting the inoculation up for potential emergency authorization later this week. Goldman Sachs economists said in a note Monday they expect 50% of the U.S. population could likely be vaccinated in April.

Investors have looked to congressional lawmakers to help bridge the gap and provide support until the pandemic abates. A bipartisan group of lawmakers released more details of their $908 billion proposal on Monday, splitting the package into two separate bills with the larger of the two encompassing items both Republicans and Democrats have agreed to back, and the smaller bill including more divisive items including liability protections and state and local government aid. Lawmakers have sought to attach a virus relief package to the larger government spending bill for the fiscal year, which must be passed by Friday.

“I’m sure Congress will come up with something. I think on both sides of the aisle, the White House as well, they all have an interest in getting something out,” Opimas CEO Octavio Marenzi told Yahoo Finance on Monday. “Now, whether it’s really as big as one expected or whether it’s more symbolic, I don’t think that really matters that much. I think it’s more about psychology.”

“The more important thing is sort of keeping an eye on the Fed and what the Fed is doing, because I think that’s what’s really been driving markets over the past half-year, has really been a liquidity injection the Fed has been pushing in,” he added.

The Federal Open Market Committee kicks off its two-day meeting Tuesday and then will release a monetary policy statement and hold a press conference with Fed Chair Jerome Powell on Wednesday. The Fed is also poised to release an updated Summary of Economic Projections at the conclusion of its meeting, after telegraphing in September that rates would likely remain at their current near-zero levels through at least 2023.

2:40 p.m. ET: Stocks extend gains, all three major indices add 1% or more

Here were the main moves in markets, as of 2:40 p.m. ET:

  • S&P 500 (^GSPC): +45.91 points (+1.26%) to 3,693.4

  • Dow (^DJI): +375.94 points (+1.26%) to 30,237.49

  • Nasdaq (^IXIC): +125.74 points (+1.01%) to 12,564.73

  • Crude (CL=F): +$0.64 (+1.36%) to $47.63 a barrel

  • Gold (GC=F): +$23.5 (+1.28%) to $1,855.6 per ounce

  • 10-year Treasury (^TNX): +3.2 bps to yield 0.923%

12:01 p.m. ET: Stocks hold onto gains, Dow adds more than 150 points

The three major indices held higher in intraday trading on Tuesday, and the utilities, materials and financials sectors led the S&P 500’s 0.7% rise. The Dow rose nearly 200 points, or 0.7%, as Apple (AAPL), Nike (NKE) and The Travelers Companies (TRV) outperformed.

The Nasdaq added 0.5% and looked on track to log a back-to-back day of gains.

9:47 a.m. ET: Industrial production rises more than expected in November as manufacturing recovery extends despite COVID-19 surge

Industrial production rose 0.4% in November following a 0.9% increase in October, the Federal Reserve reported on Tuesday. This topped consensus economist expectations for a rise of 0.3%, according to Bloomberg data. Manufacturing production, which excludes output at mines and utilities, jumped 0.8%, or twice the consensus forecast.

Capacity utilization, which measures the proportion of plants and facilities in use, also ticked up more than expected to 73.3% from 72.8% in October. The metric remains below the pre-pandemic level of 76.9% from February this year, however.

“The key story here is that the manufacturing recovery continues, even as all the near-real-time data suggest that the services sector is suffering under the third COVID wave,” Ian Shepherdson, chief economist for Pantheon Macroeconomics, said in an email. “Manufacturing will benefit over the next few months from the ongoing recovery in China’s industrial sector, which tends to lead U.S. manufacturing by a few months, and the weakening in the dollar, which has made U.S. manufacturers more competitive.”

“Strong domestic demand for goods, including everything housing-related, will also support manufacturing,” he added. “Output remains 3.6% below its February pre-pandemic peak, but we think that level will be reached again by the middle of next year.”

9:31 a.m. ET: Stocks open higher, Dow adds 150+ points

Here’s where markets opened Tuesday morning:

  • S&P 500 (^GSPC): +28.66 points (+0.79%) to 3,676.15

  • Dow (^DJI): +175.46 points (+0.59%) to 30,037.01

  • Nasdaq (^IXIC): +95.22 points (+0.77%) to 12,534.75

  • Crude (CL=F): +$0.29 (+0.62%) to $47.28 a barrel

  • Gold (GC=F): +$21.20 (+1.16%) to $1,853.30 per ounce

  • 10-year Treasury (^TNX): +2.2 bps to yield 0.913%

8:30 a.m. ET: Import prices rise less than expected in November while export prices accelerate

Prices for imports into the U.S. ticked up just 0.1% in November over the previous month, the Bureau of Labor Statistics said Tuesday, following a 0.1% decline in October. Consensus economists were looking for import prices to increase by 0.3%, according to Bloomberg data.

Fuel import prices were the primary contributor to the gain, with these rising 4.3% in November for the largest rise in two years, following a 0.9% drop in October. Prices for non-fuel imports dropped 0.3% in November, marking the first drop since April.

Meanwhile, export prices jumped 0.6% in November over October for a seventh straight monthly gain, though prices remained 1.1% below November 2019 levels. Agricultural export prices jumped 3.7% during the month for the largest rise since December 2018, driven by a 7.6% increase in prices for both soybeans and corn.

Non-agricultural export prices increased 0.3% in November following a 0.1% decrease in October.

7:12 a.m. ET Tuesday: Stock futures hold onto overnight gains

Here were the main moves in markets, as of 7:12 a.m. ET Tuesday:

  • S&P 500 futures (ES=F): 3,668.00, up 21.5 points or 0.59%

  • Dow futures (YM=F): 30,018.00, up 153 points or 0.51%

  • Nasdaq futures (NQ=F): 12,513.75, up 57.25 points or 0.46%

  • Crude (CL=F): -$0.03 (-0.06%) to $46.96 a barrel

  • Gold (GC=F): +$16.60 (+0.91%) to $1,848.70 per ounce

  • 10-year Treasury (^TNX): +1.2 bps to yield 0.903%

6:04 p.m. ET Monday: Stock futures open higher

Here were the main moves in markets, as of 6:04 p.m. ET Monday:

  • S&P 500 futures (ES=F): 3,652.5, up 6 points or 0.16%

  • Dow futures (YM=F): 29,925.00, up 60 points or 0.2%

  • Nasdaq futures (NQ=F): 12,469.75, up 13.25 points or 0.11%

People wait in line outside a CityMD Urgent Care, as the global outbreak of the coronavirus disease (COVID-19) continues, as traders stand outside the New York Stock Exchange (NYSE) in the financial district of New York, U.S., November 19, 2020. REUTERS/Shannon Stapleton
People wait in line outside a CityMD Urgent Care, as the global outbreak of the coronavirus disease (COVID-19) continues, as traders stand outside the New York Stock Exchange (NYSE) in the financial district of New York, U.S., November 19, 2020. REUTERS/Shannon Stapleton

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