Stocks jump to more than month high; dollar falls
U.S. stocks climbed to a more than a one-month high amid optimism about progress in developing a vaccine for coronavirus. The dollar weakened and crude oil increased.
The S&P 500 gained 0.9%, briefly drifting back into positive territory for the year. Varying reports on trade tensions between the U.S. and China buffeted shares. The tech-heavy Nasdaq 100 swung between gains and losses all day before closing in the green as some investors rotated into value shares. The Federal Reserve said the economy showed signs of a nascent recovery at the beginning of July.
"The virus vaccine is inspiring more bullish emotions," said Michael Zigmont, Head of Trading & Research at Harvest Volatility Management LLC. "Forget valuations, forget earnings, forget economic news."
Moderna Inc. surged to a record after the drugmaker reported promising trial results. AstraZeneca Plc rose on optimism about its vaccine efforts. The vaccine developments brought a rush of optimism to financial markets that have struggled to make headway recently in the face of new outbreaks across the U.S. and Asia.
""These are obviously some very encouraging developments, particularly on the covid front," said Candice Bangsund, portfolio manager of global asset allocation at Fiera Capital Corp. "This has allowed markets to continue thriving even despite rising cases throughout the U.S and has helped to counter ongoing U.S.-China trade tensions."
President Donald Trump has indicated to aides that he doesn't want to further escalate tensions with Beijing, and has ruled out additional sanctions on top officials for now, according to people familiar with the matter. China reportedly summoned the U.S. ambassador regarding the Hong Kong Autonomy act signed Tuesday by Trump.
Elsewhere in markets, oil gained after a report pointed to a drop in U.S. crude stockpiles. Atlantia SpA surged 25% as Italy's government moved to resolve a long-running dispute linked to a 2018 bridge collapse.
In Asia, shares in Hong Kong underperformed, while those in Shanghai fell amid signs policymakers are uneasy over the pace of recent gains.
These are some of the main moves in markets:
Stocks
The S&P 500 Index gained 0.9% to 3,226.56 as of 4:05 p.m. EDT, the highest in more than five weeks.
The Dow Jones industrial average increased 0.9% to 26,870.10, the highest in five weeks.
The Nasdaq Composite Index climbed 0.6% to 10,550.49.
The MSCI All-Country World Index gained 1.1% to 549.55, the highest in more than 20 weeks on the biggest rise in more than a week.
Currencies
The Bloomberg Dollar Spot Index fell 0.4% to 1,203.39, the lowest in five weeks on the largest fall in a week.
The euro climbed 0.1% to $1.1408, the strongest in more than four months.
The Japanese yen appreciated 0.3% to 106.93 per dollar, the strongest in more than three weeks on the largest climb in two weeks.
Bonds
The yield on two-year Treasurys declined less than one basis point to 0.15%.
The yield on 10-year Treasurys gained one basis point to 0.63%.
Germany's 10-year yield climbed less than one basis point to -0.44%.
Commodities
West Texas Intermediate crude gained 1.8% to $41.03 a barrel, the highest in almost 19 weeks.
Gold strengthened 0.2% to $1,812.20 an ounce, the highest in almost nine years.
Copper dipped 1.4% to $2.89 a pound, the largest dip in almost five weeks.
