US open: Positive start to trading as White House bets on Moderna's experimental Covid-19 vaccine
By Iain Gilbert
Date: Wednesday 12 Aug 2020
(Sharecast News) - Wall Street stocks were higher at the opening bell on Wednesday as the S&P 500 looked set to rebound from its first losing session in over a week.
As of 1530 BST, the Dow Jones Industrial Average was up 0.96% at 27,952.22, while the S&P 500 was 1.24% firmer at 3,374.95 and the Nasdaq Composite started out the session 1.66% stronger at 10,961.53.
The Dow opened 265.31 points higher on Wednesday, reversing losses recorded in the previous session despite Russia providing markets with some optimism by giving regulatory approval for the world's first Covid-19 vaccine.
Boosting sentiment at the open on Wednesday was Donald Trump's revelation that the White House would purchase 100.0m doses of Moderna's experimental Covid-19 vaccine candidate, currently in late-stage human trials.
A recent slowdown in the number of new coronavirus cases in the US was also providing investors with some optimism.
Markets.com's Neil Wilson said: "The market came up a little short yesterday but you just sense bulls will push it over the line sooner or later. After yesterday's reversal traders may be a little gun shy but the bulls have the momentum."
Also in focus was former vice president and presidential candidate Joe Biden's announcement that California senator Kamala Harris would join him on the Democratic ticket.
On the macro front, US inflation rose faster than expected in July, according to figures released on Wednesday by the Labor Department. Consumer price inflation increased 0.6% on the month, unchanged from June and higher than the 0.3% rise expected by analysts. On the year, inflation rose 1% in July from 0.6% the month before and versus expectations of 0.8% growth.
Still to come, last month's budget statement will be released at 1900 BST.
From the Fed, Boston president Eric Rosengren said the recent slowdown in US economic activity was likely to persist as a result of the difficulties individual states have experienced in their attempts to suppress Covid-19.
"Limited or inconsistent efforts by states to control the virus based on public health guidance are not only placing citizens at unnecessary risk of severe illness and possible death but are also likely to prolong the economic downturn," Rosengren said on Wednesday.
Dallas and San Francisco heads Robert Kaplan and Mary Daly will make speeches at 1600 BST and 2000 BST, respectively.
In corporate news, Tesla shares surged after approving a five-for-one stock split, while stock in Chili's parent Brinker rose after posting a narrower than expected fourth-quarter loss
Cisco Systems and Lyft will both post earnings after the close.
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