S&P 500, Dow close higher on vaccine update, retail sales beat

By Stephen Culp NEW YORK (Reuters) - The S&P 500 advanced on Friday as further clarity regarding the timeline for the development of a coronavirus vaccine and much better-than-expected retail sales data and brought buyers back to the market. The Dow also joined the S&P in positive territory, both indexes snapping a three-day losing streak driven by halted vaccine trials and continued wrangling in Washington over a new pandemic relief package. But the Nasdaq ended the session slightly lower

Reuters October 17, 2020 02:05:32 IST
S&P 500, Dow close higher on vaccine update, retail sales beat

SP 500 Dow close higher on vaccine update retail sales beat

By Stephen Culp

NEW YORK (Reuters) - The S&P 500 advanced on Friday as further clarity regarding the timeline for the development of a coronavirus vaccine and much better-than-expected retail sales data and brought buyers back to the market.

The Dow also joined the S&P in positive territory, both indexes snapping a three-day losing streak driven by halted vaccine trials and continued wrangling in Washington over a new pandemic relief package. But the Nasdaq ended the session slightly lower.

Even so, they all posted gains on the week.

Pfizer Inc announced it could apply for U.S. authorization for the COVID-19 vaccine it is developing with German partner BioNTech <22UAy.F> in November.

"The two highest-level market movers are the vaccine timeline and stimulus optimism," said Ross Mayfield, investment strategist at Baird in Louisville, Kentucky. "Sometimes the market gets a reality check that even if we get a vaccine early next year that's an incredibly aggressive and optimistic timeline."

Retail sales in September blew past analyst expectations and consumer sentiment for the current month surprised to the upside, according to two separate economic reports. But with previous stimulus having run its course, the outlook is uncertain unless Washington can reach an agreement on a fresh round of fiscal aid.

"It's important from the retail sales data to see that the consumer is not just limping a long but exceeding expectations," Mayfield added. "I don't know how long this can continue without stimulus but it's heartening to see the consumer has held up pretty well despite some dire expectations."

On the stimulus front, U.S. Treasury Secretary Steven Mnuchin told House Speaker Nancy Pelosi that President Donald Trump would "weigh in" with Senate Majority Leader Mitch McConnell if an agreement is reached on a new pandemic relief package. House Republican leader Kevin McCarthy, however, said he does not expect an agreement to be reached ahead of the Nov. 3 election as long as Pelosi is involved.

Unofficially, the Dow Jones Industrial Average <.DJI> rose 110.01 points, or 0.39%, to 28,604.21, the S&P 500 <.SPX> gained 0.58 points, or 0.02%, to 3,483.92 and the Nasdaq Composite <.IXIC> dropped 42.32 points, or 0.36%, to 11,671.56.

Third-quarter reporting season burst from the starting gate this week, with 49 of the companies in the S&P 500 having reported. Of those, 86% have cleared the low bar set by expectations, according to Refinitiv.

Analysts now see S&P 500 earnings for the July to September period dropping, in aggregate, by 18.7% year-on-year, an improvement from the 21.4% plunge estimated at the beginning of the month, per Refinitiv.

Schlumberger NV's shares dipped after posting its third straight quarterly loss due to falling crude prices and plunging demand.

Railroad operator Kansas City Southern and transportation and logistics company J.B. Hunt Transport Services Inc fell after the companies' quarterly results were hit dropping shipping demand.

The Dow Jones Transport index <.DJT>, considered a barometer of economic health, also lost ground.

Shares of fitness company Peloton Interactive Inc slipped after announcing a recall of faulty pedals on its popular exercise bikes.

(Reporting by Stephen Culp; Editing by Marguerita Choy)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

France, Germany to agree to NATO role against Islamic State - sources
| Reuters
World

France, Germany to agree to NATO role against Islamic State - sources | Reuters

By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States

China's Xi says navy should become world class
| Reuters
World

China's Xi says navy should become world class | Reuters

BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.