Dow Futures Leap Amid Coronavirus Treatment Hopes; Oil Gains As Hurricane Marco Bears Down on Gulf

The FDA's emergency use approval of blood plasma treatment for coronavirus patients boosted global stocks last night and looks set to drive Wall Street to fresh record highs Monday.
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The Monday Market Minute

  • Global stocks extend gains, with Wall Street set for fresh record highs, as investors cheer a potential breakthrough in coronavirus treatment outcomes.
  • FDA approves emergency use of blood plasma in COIVD-19 patients, which its says could reduce mortality rates by more than third.
  • Reports also suggest Trump administration looking to 'fast track' an experimental vaccine being developed by Britain's AstraZeneca.
  • Global coronavirus cases rise past 23 million, with U.S. infection rates topping 5.7 million. 
  • Oil prices gain as U.S. drilling and refining capacity goes offline ahead of landfall for both Hurricane Marco and Tropical Storm Laura early this week.
  • U.S. equity futures suggest a firmer open on Wall Street heading into a light week for earnings and economic data, highlight by a second reading of GDP and a key speech from Fed Chairman Jerome Powell Thursday.

Wall Street traded higher Monday, while the dollar edged lower and gold prices tumbled, as markets keyed on a statement from President Donald Trump that suggested a potential breakthrough in coronavirus treatments.

Stocks were also buoyed by a report from the Financial Times that hinted at the possibility that the Trump administration would 'fast track' an experimental COIVD-19 vaccine from Britain's AstraZeneca Plc  (AZN) - Get Report for treatment in the United States.

Trump's touting of the use of blood plasma in coronavirus patients, however, unveiled at a press conference in Washington Sunday, appears to be the principal catalyst for an overnight rally in stocks that could take both the S&P 500 and the Nasdaq to fresh record highs.

"This is what I've been looking to do for a long time," Trump said of the Food & Drug Administration's decision to grant emergency use approval to blood plasma treatments, which it said reduced patient mortality rates by more than a third. "Today I'm pleased to make a truly historic announcement in our battle against the China virus that will save countless lives."

U.S. equity futures bounced higher on the news, with futures contracts tied to the Dow Jones Industrial Average, which has gained 5.7% so far this month, priced for a 270 point opening bell gain. 

Futures contracts tied to the S&P 500, meanwhile, suggest a 28.5 points advance for the broader benchmark, which closed at an all-time high of 3,397.16 points on Friday . Nasdaq futures also indicate a fresh all-time high for the tech-focused benchmark, which is up 32.2% for the year, on the back of 118 point opening bell gain.

Apple  (AAPL) - Get Report shares were a notable pre-market mover, rising 1.8% and past the $500 mark for the first time ever as the tech giant prepares for its four-for-one stock split later this month.

The U.S. dollar index, which tracks the greenback against a basket of six global currencies and typically moves in the opposite direction of stock futures in the overnight session, slipped 0.28% to 92.963 ahead a light week for economic data, but a potentially key speech on monetary policy from Federal Reserve Chairman Jerome Powell on Thursday.

Global oil prices used the weaker dollar to bump higher in overnight trading, as well, with gains extended by the shuttering of nearly 1 million barrels per day of production capacity in the Gulf of Mexico as drillers and refiners brace for the twin impact of Hurricane Marco and Tropical Storm Laura early this week.

WTI contracts for October delivery, the new U.S. benchmark, traded 32 cents higher from their Friday close in New York and were changing hands at $42.66 per barrel in early European dealing while Brent contracts for October, the global benchmark, were seen 33 cents lower at $44.68 per barrel.

European stocks booked solid early gains in Frankfurt and London on the back of vaccine hopes and the potential breakthrough in coronavirus patient outcomes, with the Stoxx 600 rising 1.45% in the early hours of trading and the FTSE 100 gaining 1.65%.

Overnight in Asia, improved risk sentiment, as well as a temporary thaw in U.S.-China tensions, helped boost regional stocks, with the MSCI ex-Japan index rising 1.15% and Japan's Nikkei 225 gaining 0.28% in Tokyo to close at 22,985.51 points.