Stocks surge as Nasdaq nears 11K amid coronavirus vaccine progress

U.S. equity markets closed near the highs of the session after drugmakers reported progress in developing a COVID-19 vaccine and as Congress continued to work toward another economic relief package.

The Dow Jones Industrial Average gained 370 points, or 1.4 percent, while the S&P 500 and the Nasdaq Composite rose 0.64 percent and 0.52 percent, respectively. The Nasdaq netted its 31st record-high close of the year and ended just shy of its first close above 11,000.

NASDAQ NEARS 11,000, A NEW MILESTONE

Investors shrugged off dour data on jobs. The ADP report for July showed private employers added 167,000 jobs in July, well short of the 1.5 million that analysts surveyed by Reifintiiv were anticipating. The ADP reading sets the stage for the July jobs report, which is due out on Friday morning.

Looking at stocks, Johnson & Johnson reached a more than $1 billion deal with the U.S. government to supply 100 million doses of its Janssen Pharmaceutical Companies’ experimental COVID-19 vaccine for use in the U.S. once regulators approve.

A Phase 1 clinical trial of drug maker Novavax, Inc.’s experimental COVID-19 vaccine was generally well-tolerated and induced antibodies in 100 percent of participants.

And Moderna noted it has already received multiple orders for its experimental COVID-19 vaccine which will be priced between $32 to $37 for small doses.

On the deal front, telehealth marketer Teladoc Inc. has agreed to an $18.5 billion purchase of Livongo Health Inc.; it plans to pay $11.33 cash and 0.592 Teladoc shares for each Livongo share.

Looking at earnings, Dow component Walt Disney Co. reported revenue plunged 42 percent in the three months through June as COVID-19 shuttered its theme parks and postponed movie releases. While sales fell short of Wall Street estimates, profit outpaced expectations.

CVS Health Corp. reported quarterly profit spiked 54 percent from a year ago as COVID-19 caused people to put off elective medical procedures, helping reduce the company’s medical benefit ratio, or the amount of premium revenue spent on medical care and services.

Beyond Meat revenue surged 69 percent as surging retail growth helped offset a shock to the company’s foodservice sales. Still, shares were under pressure as climbing costs led to a deeper loss.

Wynn Resorts reported a 95 percent drop in revenue as COVID-19 kept gamblers away from its Las Vegas and Macau casinos.

Looking at commodities, gold spiked $29.90 to a record $2,031 an ounce, another new record, while West Texas Intermediate crude oil jumped $0.49 to $42.19 a barrel and settled at the highest level since March.

U.S. Treasurys were under modest selling pressure, causing the yield on the 10-year note to climb to 0.541 percent.

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In Europe, Britain’s FTSE was leading the advance, up 1.14 percent, after U.K. factory output grew at its fastest pace since November 2017. Meanwhile, France’s CAC and Germany’s DAX were higher by 0.9 percent and 0.47 percent, respectively.

Asian markets finished mixed, with Hong Kong’s Hang Seng adding 0.62 percent and China’s Shanghai Composite gaining 0.17 percent while Japan’s Nikkei slipped 0.26 percent.