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(Reuters) – Futures linked to the S&P 500 and the Dow indexes hit near five-month highs on Wednesday as signs of progress in developing a COVID-19 vaccine and a much better-than-expected quarterly profit for Goldman Sachs (NYSE:GS) brightened the mood.
The U.S. lender jumped 4.6% before the bell as its trading revenue doubled in the second quarter, driven by big swings in stock and bond markets since March.
Morgan Stanley (NYSE:MS) gained 2.8% and Bank of America (NYSE:BAC) rose 2.8% ahead of their results on Thursday which would wrap up earnings from the big six U.S. banks.
The three main U.S. stock indexes have recouped most of their losses from the coronavirus-led slump, with a raft of stimulus measures and encouraging economic data lifting the S&P 500 to within 6% of its record high in February.
With the second-quarter earnings season now underway, investors are looking for annual forecasts from marquee companies to gauge the pace of the rebound in Corporate America.
“Better-than-expected earnings help the mood because we’re in an environment where expectations have gotten very low,” said Stephen Lee, portfolio manager at Logan Capital Management in Newtown Square, Pennsylvania.
“We’re not surprised to see volatility on a day to day basis as investors balance between better-than-expected proven recovery, waiting to see earnings results, and then how successfully this healthcare challenge is going to be managed.”
The largest U.S. health insurer, UnitedHealth Group Inc (NYSE:UNH), rose 0.2% in choppy trading as its second-quarter profit more than doubled.
Moderna (NASDAQ:MRNA) Inc surged 16% after a small-scale study showed its experimental COVID-19 vaccine produced high levels of virus-killing antibodies, bolstering hopes the shot could prove effective in later stages of testing.
Travel-related stocks American Airlines (NASDAQ:AAL), United Airlines Holdings (NASDAQ:UAL), Carnival (NYSE:CUK) Corp, Royal Caribbean (NYSE:RCL) Cruises Ltd, Marriott International (NASDAQ:MAR) and Wynn Resorts (NASDAQ:WYNN) rose between 5.2% and 8.7%.
Wall Street futures and Asian equity markets had pared some gains earlier in the day after U.S. President Donald Trump ordered an end to Hong Kong’s special status under U.S. law, prompting Beijing to warn of retaliatory sanctions.
At 8:08 a.m. ET, Dow e-minis were up 556 points, or 2.1%. S&P 500 e-minis were up 45 points, or 1.41% and Nasdaq 100 e-minis were up 53.5 points, or 0.5%.
Apple (NASDAQ:AAPL) rose 1.2% after Europe’s second-top court rejected an EU order to the iPhone maker to pay 13 billion euros ($14.78 billion) in Irish back taxes.
