MANHATTAN (CN) — In a remarkable turnaround for Wall Street, investors rallied Monday around news of a potentially successful vaccine for Covid-19.
Rising oil prices had spurred investors earlier to buy back most of last week’s losses, with the Dow Jones Industrial Average leaping up about 700 points at the morning bell. By the time markets closed, the Dow finished 900 points up, a 3.8% increase for the day. The S&P 500 and Nasdaq had similar gains, marking one of Wall Street’s best days in more than a month.
While rebounding oil prices started the week on a positive note — in a tweet President Trump declared that “OIL (ENERGY) IS BACK!!!!” — the rally was given additional legs by promise of a viable vaccine against Covid-19.
Early on Monday, Moderna Therapeutics announced that eight participants in its early-stage human trial for a Covid-19 vaccine had developed antibodies against the virus. The trial was done with the National Institute of Allergy and Infectious Diseases.
According to the Cambridge, Massachusetts-based company, only three of the trial subjects suffered side effects when given a second, larger dose. Moderna will adjust its already approved phase-2 trials and plans to schedule phase-3 trials for July, after which it hopes to file an approval application with the Food and Drug Administration.
Goldman Sachs analysts wrote in a note that the data was “demonstrative of early signs of efficacy,” and that the success of lower doses of the vaccine could mean quicker manufacturing. Moderna stock soared on Monday, closing nearly 20% higher.
More than 4.7 million people worldwide have been confirmed infected by Covid-19, according to data from researchers at Johns Hopkins University, about 317,000 have died. In the United States, nearly 1.5 million people have contracted the novel coronavirus and nearly 90,000 have died.
Providing background noise to upbeat markets, the World Health Organization held its annual meeting virtually, during which more than 100 countries supported a draft resolution calling for an independent inquiry into the pandemic’s origins. The resolution could be adopted on Tuesday.
Following the draft resolution, Chinese President Xi Jinping defended his country’s actions and pledged that China would support any investigation into the origins of Covid-19 once the health effects from the pandemic were contained.
“All along we have acted with openness, transparency, and responsibility,” Xi said, according to media reports. “We have provided information to the WHO and relevant countries in the most timely fashion, we have released the genome sequence at the earliest possible time, we have shared control and treatment experiences with the world without reservation, we have done everything in our power to support and assist countries in need.”
Earlier in the day China had pledged to donate $2 billion to the United Nations to fight the virus in Africa.
Investors have grown increasingly concerned about growing tensions between the two countries, particularly over the prospect of crippling tariffs or the United States scuttling its trade deal with China, which was reached in February.
As part of the first phase of that trade deal, China would purchase $200 billion in additional U.S. imports in exchange for lower tariffs. The pandemic-ravaged country has not come close to meeting its expectations.
According to an analysis by the Peterson Institute for International Economics, China has made only $20 billion in U.S. product purchases through March, half the amount it was expected to by then.