Stocks closed higher on Monday, leading to yet another round of record closes, after the FDA granted emergency authorization for a Covid-19 plasma treatment and the number of new U.S. infections declined.
At the end of regular trading, the Dow was up 1.4%, or 378 points, at 28,308. The
closed up 1%, hitting its 16th record close of the year, and the
hit its 37th high in 2020, after rising 0.6%.
The Nikkei 225 edged up 0.3% in Tokyo while the Hang Seng gained 1.7%. European stocks rallied, with the French CAC 40 rising 2.3%. The Stoxx Europe 600 was up 1.6%.
Despite incomplete data on the treatment’s effectiveness, the Food and Drug Administration authorized emergency use of “convalescent plasma”—taking blood plasma from people who have had Covid and infusing it into those suffering from the disease. As has happened repeatedly since the virus struck, the stock market is getting a lift from news of the latest progress in the medical battle against it.
”Futures are moderately higher on Covid-19 treatment optimism following the FDA’s authorization of plasma treatment for severely ill COVID patients,” wrote The Sevens Report’s Tom Essaye before the open. ”While the EUA for plasma is clearly a positive, from a market standpoint a vaccine remains a true ‘silver bullet’ that could super charge a rally.”
The market might also be getting a lift from the fact that new Covid cases in the U.S. have fallen 22% from two weeks ago. That, more than anything, might suggest that the U.S. is finally getting the disease under control.
While there is no major economic report due for release on Monday, attention is building for the annual Jackson Hole conference, where Federal Reserve Chairman Jerome Powell is expected to outline the central bank’s new inflation strategy. Bank of England Gov. Andrew Bailey also will address that conference.
“We maintain our view that Federal Reserve support will be a more important driver for risk assets than Covid-19 or other factors, such as U.S.-China tensions and the U.S. election. We also think that this story has not been fully priced into markets,” said Mark Haefele, chief investment officer at UBS Global Wealth Management.
shares rallied nearly 6% in Hong Kong, after Bloomberg News said the White House privately assured
and Google it wouldn’t seek to block those companies from offering the WeChat product outside of the U.S.
climbed more than 7%, after Sky News reported the telecoms giant has asked
to update its defense strategy from possible suitors.
(CCL) rose 10.2% following news over the weekend that it would resume its cruises in Italy starting in early September.
(BA) rose 6.4% on news of plasma treatment for the coronavirus, which investors hope could signal that an end is in sight for the pandemic. That in turn could lead to an increase in travel, which is good for the airplane maker.
(F) closed up 4.8% on word that it is building a new factory in Michigan to build its electric F-150.
(AAPL) stock closed up 1.2% to $503.43 after Morgan Stanley raised its price target to $520, a Wall Street high.
(DE) gained 3% after getting upgraded to Buy from Neutral at Bank of America following its Friday earnings release.
Advanced Micro Devices (AMD)
is down 0.9% after getting downgraded to Market Perform from Outperform at Northland.
(FSLY) was off 1% despite getting raised to Outperform from Market Perform at Raymond James.
(EL) advanced 2.6% after getting upgraded to Outperform from Sector Perform at RBC Capital.