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Coinbase, Consumer Prices, Chip Stocks: 3 Things to Watch

Wall Street gains on vaccine news, retail sales surprise

Stock MarketsOct 16, 2020 02:20PM ET
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© Reuters. FILE PHOTO: Wall Street sign is be seen outside the New York Stock Exchange

By Stephen Culp

NEW YORK (Reuters) - U.S. stocks advanced on Friday as further clarity regarding the timeline for the development of a coronavirus vaccine and upbeat retail sales data and brought buyers back to the market.

All three indexes were on track to snap a three-day losing streak driven by halted vaccine trials and protracted pandemic relief talks in Washington.

Still, they all looked set to post gains on the week.

Pfizer Inc (NYSE:PFE) announced it could apply for U.S. authorization for the COVID-19 vaccine it is developing with German partner BioNTech in November. Pfizer's stock gained 3.4%.

Retail sales in September blew past analyst expectations and consumer sentiment for the current month surprised to the upside, according to two separate economic reports. But with previous stimulus having run its course, the outlook is uncertain unless Washington can reach an agreement on a fresh round of fiscal aid.

"This was a strong showing by the consumer," said Peter Cardillo, chief market economist at Spartan Capital Securities in New York. "Even though we still have high unemployment, the consumer hasn't changed his spending habits yet."

On that front, U.S. Treasury Secretary Steven Mnuchin told House Speaker Nancy Pelosi that President Donald Trump would "weigh in" with Senate Majority Leader Mitch McConnell if an agreement is reached on a new pandemic relief package. House Republican leader Kevin McCarthy, however, said he does not expect an agreement to be reached ahead of the Nov. 3 election as long as Pelosi is involved.

"Investors are still very much concerned about the uncertainties around the stimulus talks," said Cardillo. "We could see something before the election but whoever wins the election will probably give us a bigger stimulus package which is desperately needed."

The Dow Jones Industrial Average rose 247.49 points, or 0.87%, to 28,741.69, the S&P 500 gained 19.21 points, or 0.55%, to 3,502.55 and the Nasdaq Composite added 41.18 points, or 0.35%, to 11,755.05.

Of the 11 major sectors in the S&P 500, all but energy were in the black.

Third-quarter reporting season burst from the starting gate this week, with 49 of the companies in the S&P 500 having reported. Of those, 86% have cleared the low bar set by expectations, according to Refinitiv.

Analysts now see S&P 500 earnings for the July to September period dropping, in aggregate, by 18.7% year-on-year, an improvement from the 21.4% plunge estimated at the beginning of the month, per Refinitiv.

Oil services company Schlumberger NV (NYSE:SLB) posted its third straight quarterly loss due to falling crude prices and plunging demand. Its shares dropped 7.8%.

Railroad operator Kansas City Southern (NYSE:KSU) shed 2.3% and transportation and logistics company J.B. Hunt Transport Services Inc tumbled 9.0% after the companies' quarterly results were hit dropping shipping demand.

The Dow Jones Transport index, considered a barometer of economic health, fell 0.8%.

Shares of fitness company Peloton Interactive (NASDAQ:PTON) Inc were down 3.6% after announcing a recall of faulty pedals on its popular exercise bikes.

Advancing issues outnumbered declining ones on the NYSE by a 1.22-to-1 ratio; on Nasdaq, a 1.37-to-1 ratio favored advancers.

The S&P 500 posted 50 new 52-week highs and no new lows; the Nasdaq Composite recorded 91 new highs and 15 new lows.

Wall Street gains on vaccine news, retail sales surprise
 

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Comments (10)
Alan Rice
Alan Rice Oct 17, 2020 4:47PM ET
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Think a vaccine is going to help ??? right.
Michael Roal Casa
Michael Roal Casa Oct 16, 2020 1:39PM ET
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investores are not wise to buy and sell on pandemic recovery because of vaccine, even when it gets mass distributed in a year or 2 we will still have to wear masks for years to come.. life will not be like before, there will still be investments and a life to live but it won't be the same and there will be human anguish and financial problems for a long time to come. though the rich will always get richer but forget about a robust middle class and hello super destitute populations. also take into consideration the Republicans Tax cuts of 2 years ago as the debt burden will ****US GDP and the economy by end of this decade
Michael Roal Casa
Michael Roal Casa Oct 16, 2020 1:39PM ET
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the nay sayers can "mark my words" life will not return to life as it was in 2019 and there will be a price for future growth whether you love the Republicans or not
Leon Kelly
Leon Kelly Oct 16, 2020 1:32PM ET
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I got punched in the face with those Nflx and Boeing bull traps
Vlad Vl
Vlad Vl Oct 16, 2020 12:59PM ET
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hopes move entire economic?
Jin News
Jin News Oct 16, 2020 12:39PM ET
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Either vaccine hopes or fears, or stimulus news... So predictable
Mary Ej
Mary Ej Oct 16, 2020 12:38PM ET
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Alright...so I can expect my negative Aud buy will go into profit next week
Jesse Mulliniks
Jesse Mulliniks Oct 16, 2020 11:42AM ET
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“15 days to slow the spread”
Shriram Raja
Shriram Raja Oct 16, 2020 11:24AM ET
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If market is up it means vaccine hope if down then virus up
Shriram Raja
Shriram Raja Oct 16, 2020 11:24AM ET
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yesterday market falls on virus fear up today vaccine hope . my god. How media is turning up news
Ross Dre
Ross Dre Oct 16, 2020 7:58AM ET
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Knock it off w the headline
 
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