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U.S. stocks rose at the start of Monday’s session, kicking off the week amid fresh hope for a coronavirus vaccine and a flurry of potential and announced deals over the weekend, including reports that Oracle may be forging a partnership with TikTok, the popular China-owned social media platform.
How are equity benchmarks performing?
The Dow Jones Industrial Average DJIA, +1.21% rose 296 points, or 1.1%, to 27,960. The S&P 500 SPX, +1.61% added 47 points, or 1.4%, to 3,388. The Nasdaq Composite COMP, +2.21% climbed 215 points, or 2%, to 11,065.
Equities ended Friday trade with the Dow posting a weekly loss of 1.7%, while the S&P 500 fell 2.5% and the Nasdaq Composite Index dropping 4.1%, to mark its worst weekly drop since the period ended March 20, according to Dow Jones Market Data.
What’s driving the market?
Equities on Wall Street took on a buoyant tone at the start of the week as investors drew optimism from a number of public-health and corporate announcements that were being taken as a positive, following last week’s market turbulence that saw the Nasdaq Composite post its steepest weekly decline since the height of the pandemic-driven selloff in March.
Notably, reports that the AstraZeneca PLC AZN, +0.68% said over the weekend that clinical trials for its experimental coronavirus vaccine resumed after trials were paused due to an unexplained illness contracted by one of the participants who was given the vaccine. The restart of the trial for the vaccine may offer some optimism for the bulls to start the week.
In addition to the AstraZeneca report, Pfizer Inc.’s PFE, +2.19% CEO Albert Bourla in an interview with CBS News’ “Face the Nation,” on Sunday said that the pharmaceutical giant should know if its own experimental COVID-19 vaccine works by the end of October—and if approved, it could be distributed in the U.S. by the end of the year.
“The market is moving up on several deals along with renewed hopes of a vaccine as Astra -Zeneca restarts trials and Pfizer’s CEO suggest a vaccine may be ready by year end,” wrote Peter Cardillo, chief market economist at Spartan Capital Securities, in a Monday research note.
Indeed, a flourish of deal activity was also being digested as shares of Oracle Corp. ORCL, +5.57% jumped after it has reportedly been named a strategic partner for the U.S. operations of ByteDance-owned TikTok, according to The Wall Street Journal, citing people familiar with the matter. Such a deal would see Oracle beat Microsoft Corp., which also was seen as a front-runner in negotiations for a deal to own or operate the U.S. operations of TikTok.
An agreement to link up TikTok with a U.S. company comes amid rising tensions between America and China, with President Donald Trump threatening repeatedly to shut down TikTok in the U.S. if it isn’t sold to an American company by Sept. 15.
Elsewhere on the tech scene, chip maker Nvidia Corp. NVDA, +6.51% was seen nearing a deal to buy British chip-designer Arm Holdings for more than $40 billion from SoftBank Group Corp. and drugmaker Gilead Sciences GILD, +3.34% struck a deal to acquire Immunomedics IMMU, +100.53% and its breast-cancer drug Trodelvy for $21 billion, the Journal reported.
Which stocks are in focus?
- AstraZeneca’s shares were up 0.6%, while Pfizer Inc.’s stock rose 0.8%, as both drug companies pursuing coronavirus vaccines.
- Oracle Corp.’s shares climbed 4.3% after signs that it may beat out Microsoft for social media company TikTok.
- Shares of Seattle Genetics SGEN, +9.88% rallied 10.2% on Monday after it announced two cancer deals with Merck & Co. Inc.
- Vaxart Inc.’s stock VXRT, +28.67% jumped 16.1% after the company said it had received the go-ahead from the Food and Drug Administration to begin testing its experimental oral COVID-19 vaccine in a Phase 1 clinical trial.
- Verizon Communications Inc. VZ, +1.48% announced Monday an agreement to buy mobile provider Tracfone from America Movil AMOV, +5.92% in a cash-and-stock deal that could be worth up to $6.9 billion. Verizon’s shares were marginally higher by 0.8%.
- Wyndham Destinations Inc. WYND, +4.06% shares were up 2.8% after it said that gross vacation ownership, or VOI, sales came to $168 million in July and August with the trend improving in August from July.
- Gilead Sciences Inc. GILD, +3.34% will pay $21 billion to buy biotech Immunomedics Inc. and its breast-cancer drug. Gilead’s shares gained 0.7%.
Which markets are on the move?
The 10-year Treasury note yield TMUBMUSD10Y, 0.660% was up 0.5 basis point to 0.672%. Bond prices move inversely to yields.
Gold futures GCZ20, +1.04% on the New York Mercantile Exchange were up 0.5% to $1,956.80 an ounce. Meanwhile, U.S. crude futures CL00, -0.24% were down 0.6% to $37.11 a barrel.
In global equities, the Stoxx Europe 600 index SXXP, +0.10% was up 0.1%. Japan’s Nikkei NIK, +0.65% closed 0.7% higher, while China’s CSI 300 index 000300, +0.51% gained 0.5%.
The ICE U.S. Dollar Index DXY, -0.37%, a measure of the greenback’s strength against its major rivals, weakened 0.3%.
