New York Stock Market Rises on COVID Vaccine and Treasury Secretary Yellen Inauguration Expectations

by Paek Jongmin

Published 24 Nov.2020 07:29(KST)

[Image source=Reuters Yonhap News]

[Asia Economy New York=Correspondent Baek Jong-min] Major indices on the New York Stock Exchange showed strength, buoyed by hopes for a COVID-19 vaccine and news of former Federal Reserve (Fed) Chair Janet Yellen's nomination as Treasury Secretary.

On the 23rd (local time), the Dow Jones Industrial Average rose 327.79 points (1.12%) to close at 29,591.27, the S&P 500 index increased by 20.05 points (0.56%) to 3,577.59, and the Nasdaq Composite gained 25.66 points (0.22%) to finish at 11,880.63.

Expectations for COVID-19 vaccine distribution lifted the Dow Jones index again. The rise in the Nasdaq, which benefits from non-face-to-face sectors, was relatively limited.

Following Pfizer and Moderna, it was announced that the vaccine developed by the University of Oxford and pharmaceutical company AstraZeneca showed an average immunity efficacy of about 70% in Phase 3 clinical trials.

The news that former Fed Chair Janet Yellen was nominated as the first Treasury Secretary in the Joe Biden administration also stimulated investor sentiment late in the session.

The economic indicators released that day were positive. The November manufacturing and services Purchasing Managers' Index (PMI) released by IHS Markit was 57.7, significantly exceeding market expectations. The manufacturing PMI also reached 56.7, the highest since September 2014.

Although the employment market showed some weakness amid the resurgence of COVID-19, the service and manufacturing sectors performed better than expected.

International crude oil and gold prices reacted differently to vaccine hopes. Due to expectations of economic recovery from vaccine distribution, West Texas Intermediate (WTI) crude oil for January delivery rose 1.5% ($0.64) to close at $43.06 per barrel.