U.S. stock indexes on Monday were set to kick off a holiday-shortened week on a modestly higher note as a steady flow of updates on progress toward effective coronavirus remedies and cures creates a potential palisade against COVID-19.
U.S. markets will be closed on Thursday for Thanksgiving and volumes throughout the week are likely to be thinner than usual.
How are major benchmarks performing?
- Futures for the Dow Jones Industrial Average YMZ20, +0.44% were trading 142 points, or 0.5%, higher at 29,354.
- S&P 500 index futures ESZ20, +0.38% rose 16.30 points, or 0.5%, to 3,570.50.
- Nasdaq-100 futures NQZ20, +0.26% rose 39.25 points to reach 11,945, a gain of 0.3%
On Friday, stock indexes finished the week mostly lower:
- The Dow DJIA, -0.74% booked a 0.7% loss
- The S&P 500 SPX, -0.67% finished with a weekly decline of 0.8%
- The Nasdaq Composite Index COMP, -0.41%, however, gained 0.2%
What’s driving the market?
Investors are starting another week with positive updates on experimental therapies and prophylactics for COVID-19 that is helping to support buying, despite hospitalizations for the deadly disease entering a dangerous phase as the holiday period gets under way.
The University of Oxford and AstraZeneca AZN, +2.35% said their vaccine was found to be as much as 90% effective in preventing infections without serious side effects in a large trial, The Wall Street Journal reported.
The report comes amid a series of weekly updates on vaccines and treatments that appear to be forming a bulwark against the pathogen that has taken more than 250,000 lives in the U.S.
Over the weekend, U.S. health officials agreed to allow emergency use of a second antibody drug to help the immune system fight COVID-19, an experimental medicine that appeared to prove effective in helping treat President Donald Trump when he was sickened by the virus earlier this year.
Recently, Pfizer Inc. PFE, +1.40% filed for approval from U.S. regulators for emergency use of the vaccine it’s developed with BioNTech SE BNTX, +9.62% that has proven 95% effective in a clinical trial, while Moderna Inc. MRNA, +5.21% earlier this month said its vaccine candidate was more than 94% effective in a trial.
Wall Street is hoping that effective vaccines and therapeutics can help bring the coronavirus under control soon, even as a spike in cases and hospitalizations takes hold here and elsewhere in the world.
Indeed, the U.S. reported 142,732 new cases of the disease derived from the novel strain of coronavirus and registered a record number of hospitalizations for the 13th straight day.
Nearly 84,000 people were hospitalized with the disease as of Sunday, according to the Covid Tracking Project.
Caution about how quickly experimental drugs can be distributed, however, could create some headwinds for bullish investors.
“While the potential for vaccines to start in a matter of weeks is a reason to celebrate, the reality is that there is currently no logistical process in place for this to happen quickly,” wrote Michael Hewson, chief market analyst at CMC Markets UK.
“Furthermore, U.S. COVID cases are still rising rapidly with millions of Americans set to find this week’s Thanksgiving break severely disrupted due to various state travel restrictions,” he said.
On the political front, President-elect Joe Biden intends to nominate Antony Blinken to serve as secretary of state, according to reports. That move comes even as Trump continued efforts to contest the outcome of the Nov. 3 election, as his legal options narrowed.
In coming economic news, the Chicago Fed national activity index rose to 0.83 in October from revised 0.32 in prior month.
markets also await a flash composite purchasing managers index reading of manufacturing and services activity in the U.S. at 9:45 a.m.
Which stocks are in focus?
- Shares of Merck & Co. MRK, +0.07%Inc. surged in premarket trading Monday, after the drugmaker announced a deal to buy clinical-stage biopharmaceutical company OncoImmune for an upfront payment of $425 million in cash.
- Schrödinger Inc. shares SDGR, +3.46% jumped in premarket trade Monday, after the company announced a drug discovery agreement with Bristol-Myers Squibb Co. BMY, -0.77% that could net it up to $2.7 billion in milestone payments and royalties.
- Shares of Tesla Inc. TSLA, -1.93% were in focus on Monday after Wedbush analyst Dan Ives boosted his base-case price target, and said he envisions a scenario in which the electric vehicle market leader’s stock reaches $1,000.
- Shares of JFrog Ltd. FROG, -1.43% fell in premarket trading Monday, after the software company that went public in mid-September announced the early lock-up release of one-quarter of the locked-up shares.
- Shares of Ideanomics Inc. IDEX, +28.33% soared on heavy volume in premarket trading Monday, after the company focused on investing in disruptive technologies announced the doubling of its investment in California-based Solectrac Inc., which makes battery-powered electric tractors.
- Warner Music Group Corp. WMG, -0.51% reported Monday a breakeven fiscal fourth quarter, missing expectations, although revenue rose slightly above forecasts. The stock rose 0.8% in premarket trading.
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