S&P 500 books record on strong jobs report, Pfizer COVID-19 pill cheer

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  • U.S. job growth regains momentum
  • Pfizer jumps after positive COVID-19 antiviral pill data
  • Travel stocks highlight market gains
  • Pfizer news hits competitors, vaccine stocks

Nov 5 (Reuters) – The S&P 500 scored another record high on Friday and booked a week of solid gains following a strong U.S. jobs report and positive data for Pfizer’s experimental pill against COVID-19.

The Labor Department report showed U.S. employment increased more than expected in October as the headwind from the surge in COVID-19 infections over the summer subsided. read more

A trial of Pfizer Inc’s (PFE.N) experimental antiviral pill for COVID-19 was stopped early after the drug was shown to cut by 89% the chances of hospitalization or death for adults at risk of developing severe disease. Pfizer shares jumped. read more

The news kept the run going for equities after investors earlier in the week digested the Federal Reserve’s decision to start reducing its monthly bond purchases put in place to support the economy.

“Momentum that we have seen this week has continued, and the jobs report and the Pfizer announcement certainly are providing positive datapoints for investors to put more money into the market right now,” said Chuck Carlson, chief executive officer at Horizon Investment Services in Hammond, Indiana.

According to preliminary data, the S&P 500 (.SPX) gained 16.34 points, or 0.35%, to end at 4,696.40 points, while the Nasdaq Composite (.IXIC) gained 26.72 points, or 0.17%, to 15,967.02. The Dow Jones Industrial Average (.DJI) rose 197.25 points, or 0.55%, to 36,321.48.

Travel stocks rose following Pfizer’s announcement, with the S&P 1500 airlines index (.SPCOMAIR) climbing and cruise operators Carnival Corp (CCL.N), Royal Caribbean Cruises (RCL.N) and Norwegian Cruise (NCLH.N) rising.

“Still early to be definitive but this (pill) looks like a true game changer for many industries like leisure and transportation, you’re seeing it reflected in the prices,” said Andre Bakhos, managing director at New Vines Capital LLC in Bernardsville, New Jersey.

Among S&P 500 sectors, energy (.SPNY) and industrials (.SPLRCI) posted solid gains.

Healthcare (.SPXHC) lagged. The Pfizer news weighed on shares of competitors such as Merck (MRK.N) and COVID-19 vaccine makers such as Moderna (MRNA.O).

Shares of so-called “stay-at-home” names fell, including Zoom Video Communications (ZM.O) and Netflix Inc (NFLX.O).

Better-than-expected third-quarter earnings have helped lift sentiment for equities. With about 440 companies having reported, S&P 500 earnings are expected to have climbed 41.5% in the third quarter from a year earlier, according to Refinitiv IBES.

Reporting by Lewis Krauskopf in New York, Devik Jain and Bansari Mayur Kamdar in Bengaluru; Editing by Maju Samuel and Marguerita Choy

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