Tech shares lead Wall Street higher as potential vaccines show promise

NEW YORK: Wall Street advanced with the Nasdaq set to reach a record closing high on Monday, as investors pivoted away from cyclical stocks in favor of market leaders while new cases of COVID-19 spiraled but there were glimmers of hope that an effective vaccine will emerge.

Tech shares provided the biggest boost to all three major US stock indexes, but industrials were down, capping the Dow's gains.

Deaths in the United States from COVID-19 passed the 140,000 mark over the weekend, as cases continued to rise in 42 of 50 states.

Trials of potential vaccines have shown promise. Most recently, drugs from AstraZenica, CanSino Biologics Inc and from a partnership between Pfizer Inc and German biotech firm BioNTech were safely administered and induced immune responses.

"While there's good news on the vaccine front in early trials, the reality is setting in that it's going to take quite some time," Oliver Pursche, president of Bronson Meadows Capital Management in Fairfield Connecticut. "With industrials and materials down, that is not a reflection of a rebound in the economy."

The US Congress, still looking to mitigate the pandemic's economic effects, was set for a week of partisan wrangling over a new relief package, with two weeks until enhanced jobless benefits expire for millions of Americans.

The Dow Jones Industrial Average rose 37.52 points, or 0.14%, to 26,709.47, the S&P 500 gained 19.72 points, or 0.61%, to 3,244.45 and the Nasdaq Composite added 190.46 points, or 1.81%, to 10,693.65.

Of the 11 major sectors in the S&P 500, consumer discretionary and tech enjoyed the largest percentage gains.

Second-quarter earnings season chugged along. Some 48 companies in the S&P 500 have posted results, with 77.1% of those beating consensus, according to Refinitiv data.

In aggregate, analysts now expect S&P 500 second-quarter earnings to have dropped 43.2% year-on-year, per Refinitiv.

This week, Microsoft Corp, Amazon.com Inc, Tesla Inc and Intel Corp are among the high-profile companies expected to report quarterly results.

Shares Halliburton Co rose 3.5% after posting a surprise adjusted quarterly profit and better-than-expected cash flow due to cost-cutting.

Noble Energy Inc advanced 5.4% on news that Chevron Corp agreed to buy the oil and gas producer for $5 billion.

Chevron dropped 2.1%.

Moderna Inc dropped 15.1% on positive results from its competitors' rival COVID-19 drug trials.

After the bell, International Business Machines Corp is expected to post second-quarter results.

Declining issues outnumbered advancing ones on the NYSE by a 1.09-to-1 ratio; on Nasdaq, a 1.03-to-1 ratio favored advancers.

The S&P 500 posted 38 new 52-week highs and no new lows; the Nasdaq Composite recorded 111 new highs and 10 new lows.