Day Traders Diary

11/16/20

The major averages climb once again after preliminary coronavirus vaccine data from Moderna further lifted expectations of a strong economic recovery. The Dow Jones Industrial Average gained 470 points, or 1.6%, to close at 29,950. The 30-stock Dow logged intraday and closing record highs. The S&P 500 climbed 1.2% to 3,626, posting an all-time closing high. The Nasdaq Composite advanced 0.8% to 11,924.

Stocks that would benefit from the economy reopening led the way higher. United Airlines was up 5.2%, and Carnival closed 9.7% higher. Bank stocks such as Citigroup and Wells Fargo gained more than 3% each and JPMorgan Chase advanced 2.8%. Moderna shares jumped 9.5% on the day.

Shares of companies that have thrived during the pandemic as people spend more time at home lagged the boarder market. Netflix slid 0.8%. Amazon shares closed flat.

Moderna said Monday that its coronavirus vaccine was more than 94% effective during a late-stage trial. The promising announcement makes the Massachusetts-based biotech firm the second drugmaker to say it has a potentially effective vaccine.

Similar trial results last week from Pfizer and BioNTech drove investors into underperforming names dependent on a vaccine reopening the economy. The companies said at the time that their candidate was more than 90% effective in preventing Covid-19 among participants.

Wall Street was coming off a mixed weekly performance in which beaten-down value names led the way higher at the expense of high-flying growth names. The Dow climbed 4% last week, and the S&P 500 notched a 2.2% one-week gain. The Nasdaq Composite lagged, however, sliding 0.6%.

U.S. Treasuries had more reserved reactions to the positive vaccine news from Moderna, with yields closing slightly higher. The 2-yr yield increased one basis point to 0.18%, and the 10-yr yield increased one basis point to 0.90%. The U.S. Dollar Index decreased 0.2% to 92.59. WTI crude futures rose 3.0%, or $1.22, to $41.34/bbl.