By Geoffrey Smith
Investing.com -- U.S. stock markets surged at the opening of trade on Wednesday on growing confidence that a vaccine for the Covid-19 virus will soon be available, and on a blowout quarter from investment bank Goldman Sachs (NYSE:GS).
By 9:35 AM ET (1335 GMT), the Dow Jones Industrial Average was up 372 points, or 1.4%, at a one-month high of 27,015 points. The S&P 500 was likewise up 1.0% while the Nasdaq Composite was lagging slightly with a gain of 0.5%.
The biggest gainer of note was Moderna (NASDAQ:MRNA), whose experimental drug for treating Covid-19 generated positive results in early stage tests on humans, according to a study published in a medical journal late on Tuesday. Moderna stock rose 11.5%. Rival AstraZeneca's (NYSE:AZN) were also up 4.5% after a Business Week article claiming that its joint project with Oxford University was still likelier to produce a workable vaccine first.
Positive news on the fight for a treatment for the coronavirus tends to disproportionately support the old-economy and transportation stocks that have been hit hardest by the pandemic. Royal Caribbean Cruises (NYSE:RCL) stock rose 11.6%, Norwegian Cruise Line (NYSE:NCLH) stock rose 10.5% and Carnival (NYSE:CCL) stock rose 9.2% on bets that the three cruise operators will benefit from the greater peace of mind that a vaccine might bring to customers.
The market was also lifted by fresh data showing a rebound in the U.S. economy in June. Industrial production rose 5.4% on the month, above expectations, while the New York Empire State Manufacturing index also came in above forecasts.
Earlier, Goldman Sachs had posted its second-highest quarterly revenue after its bond and stock traders delivered their best results in over nine years. Goldman Sachs (NYSE:GS) stock rose 3.5% to its highest level since February. Goldman's focus on investment banking means that it's less exposed to the wave of corporate and personal bankruptcies that caused huge write-offs at JPMorgan (NYSE:JPM), Citigroup (NYSE:C) and Wells Fargo (NYSE:WFC) in Tuesday's earnings blitz.
Main street lenders PNC Financial and US Bancorp earlier both reported big increases in provisions in the second quarter and warned of high ongoing uncertainty. However, they too were caught up the broader enthusiasm. PNC (NYSE:PNC) stock rose 1.3%, while US Bancorp (NYSE:USB) stock rose 3.5%.
Elsewhere, UnitedHealth (NYSE:UNH) stock dropped 0.9% after the company warned that a spike in earnings due to lower claims for discretionary treatments during the pandemic will be reversed when things return to normal.
Elsewhere, oil and gas stocks got a modest lift as the Crude Oil market took in its stride guidance from the OPEC+ bloc of producers that it will raise supplies by some 2 million barrels a day from next month, as expected.