Optimism on Friday’s positive headlines about Gilead Sciences’ remdesivir continued on Monday with reports that the FDA has granted accelerated designation to possible COVID-19 vaccines from Pfizer and a German company.
The tech-rich Nasdaq composite surpassed 10,800 for the first time thanks to gains from various companies, including Facebook, Apple and Amazon, while Tesla stocks jumped about 16%.
The S&P 500 briefly wiped out all the losses for the year.
However, market rallies evaporated in afternoon trading, Tesla reversing and falling 3.1% while large tech companies were down at least 1.7%.
“Early optimism has waned,” said Erik Bregar, head of monetary strategy at the Exchange Bank of Canada.
The electric car maker has figured more prominently in the currency markets than normal, unless the movements are large enough, he said in an interview.
“I can report the rally in the US dollar as soon as Tesla started tanking. ”
Another factor in the afternoon liquidation was an increase in infection rates in California, which prompted the state governor to cancel most reopening measures, including closure statewide bars, cinemas and restaurants.
The S & P / TSX composite index closed down 74.41 points to 15,639.41 after reaching an intraday high of 15,879.73.
In New York, the Dow Jones industrial average was up 10.50 points to 26,085.80 more than 550 points from its previous high. The S&P 500 lost 29.82 points to 3,155.22 after surpassing 3,235, while the Nasdaq composite lost 226.60 points or 2.1% to 10,390.84.
The Canadian dollar traded at 73.71 cents US against 73.56 cents US on Friday.
Technology was the biggest driver of the TSX, losing 2.5% while Shopify Inc. and Lightspeed POS Inc. lost 6.2% and 5.5% respectively while Blackberry Ltd. lost 3.3%.
Energy fell due to lower prices for crude oil and natural gas, Seven Generations Energy Ltd. down 5.3% and MEG Energy Corp. 4.4%.
The August contract for crude oil fell 45 cents to US $ 40.10 per barrel and the August contract for natural gas fell 6.6 cents to US $ 1.74 per mmBTU.
Materials slipped slightly despite rising metal prices, Oceanagold Corp. having fallen by 8.3%.
The August gold contract rose by US $ 12.20 to US $ 1,814.10 an ounce and the copper contract in September rose 5.75 cents to almost US $ 2.96 per pound.
Healthcare increased thanks to strong gains from Aphria Inc., while the heavy financials sector climbed, with Manulife Financial and Toronto-Dominion Bank increasing by 1.9 and 1.4% respectively.
Monday’s negotiations take place before the start of quarterly results with the major American banks.
The results are expected to be dismal due to the impact of COVID-19, but if companies exceed expectations, this could produce positive surprises, said Bregar.
“It could probably give the stock market a boost and probably put a little more pressure on the US dollar. “