Stocks posted a rebound Tuesday following a four-day losing streak for the S&P 500 as Moderna's (MRNA) - Get Report coronavirus vaccine was determined to be highly effective by staff at the Food and Drug Administration.
Also boosting sentiment were reports that House and Senate leaders would be meeting to discuss a coronavirus relief package.
The Dow Jones Industrial Average finished up 338 points, or 1.13%, to 30,199, the S&P 500 gained 1.29% and the Nasdaq rose 1.25%.
If the Moderna vaccine gets approval from the full FDA later this week, it could be shipped by the weekend. Moderna's vaccine would join the shot developed by Pfizer (PFE) - Get Report and BioNTech (BNTX) - Get Report that was administered for the first time in the U.S. on Monday.
Moderna shares fell nearly 5% during regular trade to end Monday at $147.22. After the close, Jefferies analyst Michael Yee downgraded Moderna from buy to hold. The stock traded down another 1.3% in after-hours trade.
The S&P 500's four-day losing streak was its longest since September, coming amid a surge in coronavirus infections across the country that has renewed fears an economic recovery could slow if restrictive lockdowns were again put in place.
The U.S. death toll from Covid-19, the disease caused by the coronavirus, crossed 300,000 on Monday. New York City Mayor Bill de Blasio warned residents they should be prepared for a full shutdown.
Wall Street also remains tuned to efforts by lawmakers in Washington to craft a stimulus bill, but bitter partisanship has stalled negotiations. Many investors see a relief package as absolutely essential for the economy to bridge the gap between now and the broader rollout of coronavirus vaccines.
House Speaker Nancy Pelosi will meet with her fellow congressional leaders Tuesday to try to strike a stimulus deal, CNBC reported, citing a source familiar with her outreach.
A bipartisan group of lawmakers released a $908 billion aid package proposal on Monday.
The Federal Reserve begins a two-day meeting on Tuesday, the central bank's last meeting of the year.
An announcement on interest rates is expected Wednesday afternoon. While the central bank is expected to hold rates steady, indications on what moves the Fed may make in the new year, including guidance on continued asset purchases, will be watched closely by investors.
Joe Biden’s Electoral College win over President Donald Trump was finalized Monday after the Democrat collected the 270 votes needed to secure the presidency. Biden won a total of 306 votes to Trump's 232.
Senate Majority Leader Mitch McConnell acknowledged Biden as president-elect Tuesday following weeks of refusal by many Republicans to recognize the results of the Nov. 3 election.