NEW YORK/BENGALURU (March 1): The S&P 500 on Monday was headed for its best day since June 5, as bond markets calmed after a month-long selloff, while encouraging updates on Covid-19 vaccines and fiscal stimulus bolstered bets over a swift economic recovery.
The Dow was on pace for its best daily gain in nearly four months, while the Nasdaq was set for its best daily percentage gain in a month.
Johnson & Johnson rose 1.8% as it began shipping its single-dose vaccine, after it became the third authorised Covid-19 vaccine in the United States over the weekend.
President Joe Biden scored his first legislative win as the House of Representatives passed his US$1.9 trillion coronavirus relief package early Saturday (Feb 27). The bill now moves to the Senate.
US bond yields eased on Monday after a swift rise last month, on expectations of accelerated inflation due to bets on an economic rebound. The US 10-year treasury yield eased to 1.419%, after hitting a one-year high of 1.614%.
"The sentiment is risk on with more investors showing interest towards cyclical stocks, while a positive vaccination drive and better macro numbers are hinting towards a better growth environment," said Keith Buchanan, portfolio manager at GLOBALT in Atlanta.
Latest data showed US manufacturing activity increased to a three-year high in February, amid an acceleration in new orders.
All major S&P sectors were higher with those that stand to benefit more from an economic rebound outperforming. Financials , energy, industrials and materials gained between 2.6% and 3%.
Wall Street's main indexes ended lower last week, with the Nasdaq suffering its worst week in four months, as a rise in long-dormant yields signaled bonds are more serious investment competition, sparking a pullback in high-valuation tech stocks.
Apple, Microsoft Corp, Facebook Inc and Amazon.com Inc rebounded between 1% and 3.9% on Monday.
At 11:25 a.m. ET, the Dow Jones Industrial Average rose 685.37 points or 2.22% to 31,617.74, the S&P 500 gained 86.63 points or 2.27% to 3,897.78, and the Nasdaq Composite gained 318.06 points or 2.41% to 13,510.41.
Shares of cruise liner and carriers including Carnival Corp, Delta Air Lines Inc and American Airlines gained between 1.9% and 4.4%.
Boeing Co jumped 5.9% as United Airlines Holdings Inc ordered 25 new 737 MAX aircraft and moved up the delivery of others, as it prepares to replace aging jets and meet expected post-pandemic growth in demand.
Warren Buffett's enthusiasm for the future of America and his company Berkshire Hathaway Inc has not been dimmed by the coronavirus pandemic, according to his annual letter to investors. Berkshire's shares rose 2.3%.
Perrigo Co Plc jumped about 7%, as the consumer healthcare products company said it would sell its underperforming generic drugs business for US$1.55 billion.
Advancing issues outnumbered decliners by a 5.8-to-1 ratio on the NYSE and by a 5.6-to-1 ratio on the Nasdaq.
The S&P 500 posted 38 new 52-week highs and no new low, while the Nasdaq recorded 172 new highs and 45 new lows.