Stocks rally as optimism builds around coronavirus vaccine

By Jonathan Garber FOXBusiness

U.S. equity markets battled higher Tuesday morning as optimism continued to swirl around the possibility that a COVID-19 vaccine could be announced in a matter of weeks.

The Dow Jones Industrial Average gained 193 points, or 0.69%, while the S&P 500 and the Nasdaq Composite were higher by 0.96% and 1.26%, respectively.

“We’re going to have a vaccine in a matter of weeks, it could be four weeks, it could be eight weeks,” President Trump told “Fox & Friends” on Tuesday. “I’m not doing it for political reasons, I want the vaccine fast.”

Looking at drug stocks, Moderna Inc., Pfizer Inc. and Johnson & Johnson ticked higher while BioNtech SE gained on news it received 375 million euros of German funding for a COVID-19 vaccine and Novavax Inc. announced an agreement with Serum Institute of India to manufacture 2 billion doses annually of its experimental COVID-19 vaccine.

Elsewhere, Apple Inc. shares were in focus as the tech giant was set to unveil new products at a virtual event on Tuesday.

Other mega-cap tech companies, including Amazon Inc., Facebook Inc. Microsoft Corp. and Tesla Inc., continued to grind higher.

Nikola Corp. shares continued to see volatility after short-seller Hindenberg Research said the electric-truck maker’s rebuttal of its claims is a “tacit admission of securities fraud.” Hindenberg last week accused Nikola of misleading partners about its technology. Nikola has called the claims “false and deceptive.”

Meanwhile, Kraft Heinz Co. plans to reduce costs by $2 billion over the next five years, CEO Miguel Patricio told The Wall Street Journal. The company plans to use some of the savings to increase marketing spending by 30%.

Citigroup Inc. will trim less than 1% of its global workforce after previously announcing it would pause staff reductions amid the pandemic. The company’s headcount is expected to hold relatively steady due to recent hiring.

Looking at earnings, homebuilder Lennar Corp. reported better-than-expected top and bottom-line results as sales grew in all major markets. However, the company warned average sale prices are set to decline during the current quarter.

Looking at commodities, West Texas Intermediate crude oil climbed 22 cents to $37.48 per barrel and gold slid $5.20 to $1,958.50 an ounce.

U.S. Treasurys slipped, causing the yield on the 10-year note to edge up 1.6 basis points to 0.685%.

European markets were rallying across the board with Britain’s FTSE up 1.07%, France’s CAC higher by 0.37% and Germany’s DAX gaining 0.33%.

In Asia, Japan’s Nikkei slid 0.44% while Hong Kong’s Hang Seng and China’s Shanghai Composite added 0.38% and 0.52%, respectively.

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