Dow ends at record on dovish Fed, vaccine progress

The Dow managed to shrug off early weakness to finish at a new record.
The Dow managed to shrug off early weakness to finish at a new record.PHOTO: AFP

NEW YORK (AFP) - The Dow finished at a fresh record on Wednesday (Feb 24), shaking off early weakness following dovish comments from the Federal Reserve chief and progress on another coronavirus vaccine.

The Dow Jones Industrial Average jumped 1.4 per cent to close at 31,961.86, a new all-time high.

The broad-based S&P 500 gained 1.1 per cent to end at 3,925.43, while the tech-rich Nasdaq Composite Index advanced 1 per cent to 13,597.97 after two days of declines.

Appearing for a second day of congressional testimony, Fed Chair Jerome Powell reiterated his expectations that inflation will remain mild and that interest rates will stay low for a while longer.

Art Hogan of National Securities said the comments reassured investors that spiking yields on US Treasury notes in recent days do not hearken worrisome inflation or a major lurch in monetary policy.

Beyond that, investors also were cheered by news that “another vaccine is likely available” soon, Hogan said.

New documents released by the US Food and Drug Administration on Wednesday showed the single-shot Johnson & Johnson vaccine is highly effective in preventing severe Covid-19, including newer variants.

Johnson & Johnson rose 1.3 per cent.

Other winners included equities expected to prosper from a post-coronavirus economic recovery, including American Airlines, up 5.6 per cent, Boeing, up 8.1 per cent and Carnival, up 2.1 per cent.

GameStop had a big day, more than doubling in value to US$91.71, a sign of another wave of extreme volatility in some stocks.

Frenzied trading in GameStop and a handful of other stocks in recent weeks in the wake of social media investor campaigns have fueled investigations and congressional hearings.