Wall Street’s main indexes rose and the Nasdaq hit a record high on Friday as optimism around an economic rebound next year outweighed concerns around an expected surge in coronavirus infections following the Thanksgiving holiday.
The sentiment was also lifted by United States President Donald Trump saying he will leave the White House if the Electoral College votes for President-elect Joe Biden, the closest he has come to conceding the November 3 election.
“While it was certainly the expectation of the vast majority of traders that there would be an easy transfer of power, at the end of the day it gives a little bit of confidence,” said Rick Meckler, a partner at Cherry Lane Investments in New Jersey.
The three main US stock indexes have gained more than 10 percent this month as investors were encouraged by signs that COVID-19 vaccines were on track to be rolled out in the weeks ahead, setting the S&P 500 for its best November ever.
Although European bourses were subdued by doubts around the effectiveness of AstraZeneca’s vaccine, Meckler said it would not affect the US stock market with traders betting on candidates being developed by Pfizer Inc and Moderna Inc.
By 9:40am ET, the Dow Jones Industrial Average was up 131.92 points, or 0.44 percent, at 30,004.39, the S&P 500 was up 12.86 points, or 0.35 percent, at 3,642.51, and the Nasdaq Composite was up 79.33 points, or 0.66 percent, at 12,173.74.
Nine of the 11 major S&P sectors were higher, with only the real estate and the utility sectors, commonly considered defensive, trading lower.
A rotation into sectors deemed to benefit from an economic recovery, such as industrial and financial, has also powered the Dow to record highs and put it on track for its biggest monthly gain since 1987.
Wall Street has seen record highs even as Main Street struggles. Food banks like the Los Angeles Regional Food Bank have seen a surge in people needing help [File: Mike Blake/Reuters]Market volatility, as measured by the CBOE volatility index, slipped to pre-pandemic levels. Trading volumes are expected to be light as the US stock market closes early on Friday.
US-listed shares of iQIYI Inc fell 2.8 percent after the Reuters news agency reported Alibaba Group Holding Ltd and Tencent Holdings Ltd had put on hold talks to buy a controlling stake in the video streaming service.
Next week, investors will get the latest economic snapshot, including the monthly employment report. Economists polled by Reuters expect the December 4 jobs report to show unemployment dipped to 6.8 percent from 6.9 percent, but still well above the 4.5 percent rate in March, before much of the US economy went into lockdown.
Advancing issues outnumbered decliners 1.58-to-1 on the NYSE and 2.06-to-1 on the Nasdaq.
The S&P index recorded 17 new 52-week highs and no new low, while the Nasdaq recorded 75 new highs and four new lows.