Stocks soared to start the week after Moderna (NASDAQ:MRNA) said its vaccine to treat the novel coronavirus showed promise in boosting the immune system to ward off the deadly respiratory illness.
- The S&P 500 soared 3.15%.
- The Dow Jones Industrial Average added 3.85%
- The Nasdaq Composite climbed 2.44%
- Underscoring just how strong the rally was today, Boeing (NYSE:BA) gained 13.17% to pace the Dow and it wasn’t even close as that stock topped its closest competitor by a wide margin today.
The Moderna news is vital and not just for those fortunate enough to own the stock, which has now more than doubled over the past month. Moderna’s Covid-19 vaccine efforts long were viewed as among the most advanced, but today’s news likely exceeds even more ambitious timelines.
That’s crucial because if the company can bring the vaccine to market before the 12- to 18-month widely assigned to coronavirus medicines, that could allay concerns about reopening the U.S. economy without adequate treatment for the virus.
Adding to the good cheer today was Federal Reserve Chairman Jerome Powell’s interview last night with 60 Minutes. If you didn’t catch it, the remarks that market participants latched onto today boil down to Powell saying the central bank has more tools left in its belt to help the still-fragile U.S. economy.
Those comments mean something because in late trading, the rare 30 for 30 scenario was seen as all Dow stocks were higher.
Burned by Moderna News
As noted above, all 30 of the Dow stocks were in the green late in Monday’s session, but the laggards were the index’s healthcare names, including Johnson & Johnson (NYSE:JNJ), Merck (NYSE:MRK) and Pfizer (NYSE:PFE).
JNJ and Pfizer are among the more than 100 companies involved in the coronavirus treatment/vaccine competition, so its not surprising with news of Moderna’s progress on that front that those two Dow stocks didn’t soar today. Still, the trio of aforementioned drug stocks posted modest gains.
Good News Ahead of Earnings
Data from research M Science confirm what many already were talking about: home improvement retailers, including Home Depot, benefited from remaining open during the darkest days of the Covid-19 shutdown and foot traffic at their stores surged.
Much of that good news is priced into Home Depot shares here, so the burden is now proving to Wall Street and investors that these gains are sustainable as Covid-19 fears ease.
Speaking of Virus Winners…
Walmart (NYSE:WMT) is also part of the pantheon of essential retailers that seriously benefited from the coronavirus situation and like Home Depot, the world’s largest retailer reports quarterly results tomorrow.
Analysts are expecting Walmart to report earnings of $1.09 a share, on revenue of $130.58 billion The story here is similar to Home Depot’s: virus buying is priced into Walmart and it’s now about what the rest of the year is going to look like, not how the retailer derived benefits from its essential status in prior months.
Big Name Invests in Disney
Recent strength in Walt Disney (NYSE:DIS) continued today after news emerged over the weekend that famed hedge fund manager Dan Loeb took a stake in the stock. Additionally, a separate report surfaced that Disney Springs, an entertainment area near Disney World in Orlando, will reopen Wednesday.
Bottom Line on the Dow Jones Today
There’s no denying that Powell’s comments helped markets today and it certainly puts investors at ease to know that the Fed has some arrows left in its quiver. But rather than ongoing monetary response, more fiscal response is probably needed and that means more politics.
Todd Shriber has been an InvestorPlace contributor since 2014. As of this writing, he did not hold a position in any of the aforementioned securities.