Futures rise as vaccine progress fuels recovery hopes

(Reuters) – U.S. stock index futures rose on Monday as hopes that the first COVID-19 vaccine could be available within weeks renewed bets of a swift economic recovery next year.

FILE PHOTO: The New York Stock Exchange (NYSE) is seen as people walk in silhouette in the financial district of New York, U.S., November 19, 2020. REUTERS/Shannon Stapleton/File Photo

The U.S. Food and Drug Administration is likely to approve in mid-December the distribution of the vaccine made by Pfizer Inc and German partner BioNTech, a top official of the government’s vaccine development effort said on Sunday.

Global equity markets received a boost earlier on Monday as AstraZeneca Plc became the latest major drugmaker to say its COVID-19 vaccine could be around 90% effective, although its shares fell 1.8% as some traders perceived the efficacy data as disappointing compared with rivals.

“Today’s vaccine news is positive, but it is only partly responsible for the rally in stock markets this morning, which is also being driven by the news that the United States hopes to start the vaccination program in under three weeks,” said Philip Shaw, chief economist at Investec in London.

At 7:07 a.m. ET, Dow e-minis were up 142 points, or 0.49%, S&P 500 e-minis were up 15.25 points, or 0.43%, and Nasdaq 100 e-minis were up 30 points, or 0.25%.

Evidence of high efficacy rates in experimental vaccines lifted the benchmark S&P 500 to a record high earlier this month, although gains have since been capped by concerns around more lockdowns to contain a surge in infections.

Nevada on Sunday became the latest U.S. state to tighten restrictions on casinos, restaurants and bars, while imposing a broader mandate for face-coverings over the next three weeks.

After data last week signaled a faltering labor market recovery, flash readings of business activity surveys due later in the day are expected to show the manufacturing and services sectors expanded at a slower pace in November.

In the absence of new fiscal stimulus, investors have again turned to the Federal Reserve for signs of more monetary support, although Treasury Secretary Steven Mnuchin last week pulled the plug on some of the central bank’s pandemic emergency lending programs.

In company news, shares of drugmaker Regeneron Pharmaceuticals Inc jumped 5.7% in premarket trading after the FDA on Saturday granted emergency use authorization to its COVID-19 antibody therapy.

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