By Yasin Ebrahim
Investing.com - Wall Street soared on Tuesday as ongoing efforts to reopen states nationwide and hopes for a Covid-19 vaccine boosted investor sentiment.
The Dow Jones Industrial Average rose 2.66%, or 651 points, the S&P 500 gained 1.83% to rise above 3,000 for the first time since Mar. 5, while the Nasdaq Composite added 0.77%.
The race for a potential vaccine continues to heat up, with Novavax (NASDAQ:NVAX) rallying about 5% after the drugmaker said it had begun human trials for its potential coronavirus vaccine.
Merck (NYSE:MRK) climbed 1.6% after it said it had teamed up with scientific research company IAVI to develop a potential vaccine.
Easing fears that reopening the economy could trigger a wave of infections also supported sentiment following data showing states that reopened before the start of May have seen a 29% reported drop in cases over the past three weeks, according to CNBC.
In another boost to reopening optimism, New York Gov. Andrew Cuomo said on Sunday that state, the epicentre of the outbreak, is "decidedly in the reopening phase," with sports leagues, campgrounds and veterinarian offices set to reopen, albeit with limitations.
Efforts to reopen states nationwide has many expecting that domestic travel will pick and support battered airlines.
UBS upgraded Southwest Airlines (NYSE:LUV) to buy from neutral and raised its price target on the stock to $41 from $37, sending its shares 12% higher. American Airlines (NASDAQ:AAL) was up 12% and United Airlines (NASDAQ:UAL) jumped 15%.
Financials led the charge higher for the broader market as investors piled into beaten-down bank stocks, with JPMorgan Chase (NYSE:JPM) and Goldman Sachs (NYSE:GS) up about 8% and Citigroup (NYSE:C) rising10%.
Energy, meanwhile, caught a bid on a sharp uptick in oil prices amid ongoing bets that output cuts by major producers and ongoing signs of a recovery in crude demand will alleviate the glut in supplies.
On the economic front, investors mulled mixed data as U.S. consumer confidence undershot expectations, but housing activity continued to rebound.
The Conference Board’s consumer confidence gauge rose to a reading of 86.6 in May from 85.7 the prior month, missing economists’ forecasts for a reading of 88. New home sales jumped to 623,000, topping economists' forecasts of 490,000.