Despite opening on a weak note, U.S. stocks ended higher on Tuesday as positive developments on the vaccine front and hopes of a fiscal stimulus outweighed reports showing a surge in coronavirus cases across the country.
Buying interest, however, was somewhat subdued.
The major averages all ended modestly higher. The S&P 500 and the Nasdaq both posted new closing highs. The Dow ended higher by 104.61 points or 0.35 percent at 30,174.40. The S&P 500 moved up 10.29 points or 0.28 percent to settle at 3,702.25 and the tech-laden Nasdaq climbed 62.83 points or 0.5 percent to 12,582.77.
News about the U.K. beginning to administer the coronavirus vaccine developed by Pfizer/BioNTech and that it found no safety concerns with the vaccine helped lift sentiment.
The continued surge in coronavirus cases and increasing number of hospitalizations in the U.S. boosted hopes for a U.S. pandemic stimulus.
The U.S. Congress is expected to vote this week on a one-week stopgap funding bill to give negotiators more time to strike a compromise.
U.S. Senate Democratic leader Chuck Schumer said there were signs of progress in talks on a bipartisan bill.
Shares of Pfizer and BioNTech moved up sharply and gained about 3% and 2%, respectively.
DuPont, Honeywell International, Johnson & Johnson, Chevron and Walmart also posted strong gains.
The US Food and Drug Administration (FDA) on Tuesday announced that the Pfizer-BioNTech COVID-19 vaccine BNT162b2 is safe and effective.
The FDA in a detailed analysis concluded that safety data from about 38,000 participants suggest a “favorable safety profile,” with no specific safety concerns identified that would preclude issuance of an EUA.
The FDA said the vaccine met “prespecified success criteria for the study’s primary efficacy endpoint,” increasing the likelihood for the COVID-19 vaccine to get an emergency-use authorization this week itself. The findings also said that two months of trial data revealed no significant safety issues.
In economic news, unit labor costs in the US nonfarm business sector slumped at an annual rate of 6.6 percent in the third quarter of 2020 following an upwardly revised 12.3 percent rise in the prior period. Preliminary estimates showed an 8.9 percent fall in the third quarter.
In overseas trading, the major European markets turned in a mixed performance. Stock markets across the Asia-Pacific region ended mostly lower amid worries about surging coronavirus cases and rising tension between Washington and Beijing.
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