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* Cisco and Disney are gaining ground on quarterly reports
* Biden helps discuss targeted COVID restrictions versus national lockdown
* Indices up: Dow 1.31%, S&P 1.14%, Nasdaq 0.61% (updates by late afternoon, comment added, New York date, changes per line)
By Sinéad Carew
NEW YORK, Feb. 6 / PRNewswire / – Wall Street gained ground on Friday with bullish earnings reports to fuel optimism about the economy, despite investors weighing a recent surge in virus cases against hopes for successful COVID-19 vaccines to have.
After a volatile week of trading with the market swaying between hopes and fears about the virus, Cisco Systems Inc led the S&P 500 winners after its quarterly report showed an increase in home demand.
While the network equipment maker rose 7%, Walt Disney Co rose 2% as the fast-growing streaming video business and partial recovery at its theme parks mitigated the quarterly loss.
The reports have likely helped investors look past a recent surge in virus cases and a dreary winter, said Tom Martin, senior portfolio manager at Globalt Investments in Atlanta.
“We know we have some tough times ahead of us, but by mid-2021 you may find that with a vaccine and better treatment in place of the coronavirus, which is causing more harm, a recovery is ahead,” Martin said. “You are at that time of year when people are starting to look forward to 2021.”
Martin also pointed to the hope that Moderna Inc MRNA.O is about to release details on vaccine progress after the company announced on Wednesday that it had enough data for an initial interim analysis of the late stage of its experimental COVID-19 Vaccine.
The outperformance of more economically sensitive sectors like energy (plus 4%) and industry (plus 1.9%) versus growth sectors like technology (plus 0.5%) on Friday indicated that, according to Martin, “the optimism about the Economy is getting back on its feet “.
At 2:57 p.m. EST, the Dow Jones Industrial Average rose 398.05 points, or 1.37%, to 29,478.22, the S&P 500 rose 43.88 points, or 1.24%, to 3,580.89, and the Nasdaq Composite rose 91 .81 points or 0.78% to 11,801.40.
According to third-quarter reports released by roughly 90% of the S&P 500 companies, Refinitiv IBES estimates now show a 7.8% year-over-year earnings decline compared to October 1’s expectation for a slump of 21.4%.
The top three US stock indices fell Thursday as more than a dozen US states reported a doubling of new COVID-19 cases in the past two weeks. The Mayor of Chicago issued a month-long stay at home recommendation.
However, a senior adviser to President-elect Joe Biden said there were no plans for statewide lockdowns for next year and instead spoke about restrictions on certain regions if the virus spreads poorly there.
Positive early data from a large vaccine study earlier this week had sparked a rotation in cyclical sectors, putting the S&P 500 and Dow on track for their second consecutive weekly gains.
However, the tech-heavy Nasdaq was poised for a weekly decline as investors posted gains in technology stocks that benefited from a home-stay environment.
Meanwhile, Biden’s victory in the battlefield state of Arizona increased his electoral margin, but the official transition remains pending as President Donald Trump refuses to admit.
Growth stocks, which are currently mostly tech companies, gained 0.3%, while value names, which currently include mostly cyclical stocks like banks and energy, rose 1.8%.
Advancing issues outperformed declining issues on the NYSE by a ratio of 4.44 to 1; On Nasdaq, a ratio of 2.49 to 1 favored the advanced.
The S&P 500 posted eight new 52-week highs and no new lows. The Nasdaq Composite made 67 new highs and 11 new lows. (Additional reporting by Stephen Culp in New York, Medha Singh and Shivani Kumaresan in Bengaluru; editing by Saumyadeb Chakrabarty, Shounak Dasgupta and Tom Brown)