Nasdaq set to jump as tech stocks snap back

(Reuters) – Wall Street’s main indexes were set to open higher on Wednesday as signs of a working COVID-19 vaccine raised hopes of a faster-than-expected economic rebound, with technology stocks bouncing back from steep losses this week.

FILE PHOTO: The U.S. flag covers the front facade of the New York Stock Exchange (NYSE) in New York City, New York, U.S., November 9, 2020. REUTERS/Brendan McDermid

Nasdaq 100 futures were up more than 1%, while technology mega-caps including Netflix Inc, Inc and Facebook Inc, the so-called stay-at-home winners, also gained about 1% in premarket trading.

Encouraging data from a late-stage vaccine earlier this week prompted a rotation away from technology names, and lifted demand for stocks sensitive to economic growth, as well as those that have lagged this year such as energy, financials and industrials.

The top U.S. infectious disease specialist urged caution until a vaccine can be approved and distributed, as California and several states across the U.S. Midwest tightened restrictions.

“It will be a long time before we can get a sizable part of the population inoculated with the vaccine… but it does speak to a slightly brighter future,” said Randy Frederick, vice president of trading and derivatives for Charles Schwab in Austin, Texas.

Markets, which also got a boost after Democrat Joe Biden was projected the winner of the U.S. election on Saturday, have also shrugged off legal challenges from President Donald Trump.

Meanwhile, the Democratic Party retained control of the U.S. House of Representatives, but investors are more focused on Senate races in Georgia in January that could determine if major Democratic priorities like a large coronavirus aid bill would be passed by Congress.

At 08:26 a.m. ET, Dow E-minis were up 0.71% and S&P 500 E-minis were up 0.86%.

Lyft Inc jumped 5.7% after the ride-hailing app said it was working on a new service to take a slice of the burgeoning food-delivery market, as it works to make up for a drop in quarterly revenue.

Chip stocks, including Advanced Micro Devices Inc, Nvidia Corp and Qualcomm Inc, rose between 1% and 2% after suffering sharp losses a day earlier.

Source: Read Full Article