Wall Street opens higher as travel stocks surge on vaccine roll-out

The Dow Jones Industrial Average rose 77.54 points, or 0.26 per cent, at the open to 30,123.91

Wall Street's main indexes rose on Monday as travel stocks surged on the launch of a nationwide Covid-19 vaccine campaign, while Alexion Pharmaceuticals jumped on a $39 billion buyout offer from AstraZeneca in one of the year's biggest deals.

Shipments of the Pfizer-BioNTech vaccine fanned out to distribution points across the United States on Sunday, with injections set to begin on Monday.

The inoculations are seen as pivotal toward ultimately halting the Covid-19 pandemic, which has claimed more than a million lives around the world and brought economic activity to a halt.

"There is no question the market is very optimistic about the vaccines finally being delivered," said Thomas Hayes, managing member at Great Hill Capital Llc in New York.

Cruise operators Carnival Corp and Royal Caribbean Cruises rose 4.1 per cent and 0.5 per cent, respectively, while stocks of major airline operators added between 0.7 per cent and 3.1 per cent, with American Airlines Group leading gains.

Travel and leisure stocks are the worst hit by restrictions on movement due to the virus outbreak, and have reacted positively to any vaccine-related news.

Alexion Pharmaceuticals Inc was among the top boosts to the S&P 500 and the Nasdaq, surging 29.9 per cent to a 4-1/2 year high after British drugmaker AstraZeneca said it would buy the US biotech firm.

AstraZeneca's US-listed shares fell 6.7 per cent.

"It is a sign that animal spirits are back ... companies are reluctant to do deals when they have a negative outlook on the future, but the fact that you are seeing these types of big deals on merger Mondays is a sign of things to come," Hayes added.

At 9:54 a.m. ET, the Dow Jones Industrial Average was up 242.50 points, or 0.81 per cent, at 30,288.87, the S&P 500 was up 31.31 points, or 0.85 per cent, at 3,694.77, and the Nasdaq Composite was up 126.03 points, or 1.02 per cent, at 12,503.91.Healthcare stocks were among the best performing S&P 500 sectors on Monday.

US stocks had rallied through the past few weeks, with the S&P 500 touching a series of record highs as markets bet on the swift approval and roll-out of a vaccine.

But uncertainty over more fiscal stimulus had stifled gains, after the Senate last week approved a one-week extension of federal funding to avoid a government shutdown and to provide more time for negotiations on coronavirus relief and an overarching spending bill.

Shares of delivery firms FedEx Corp and United Parcel Service Inc, which are leading the vaccine distribution project, rose 1.7 per cent and 1.3 per cent, respectively.

Among other movers, ecommerce company Alibaba Group Holding Ltd shed 2.5 per cent after China warned its internet majors of more anti-trust scrutiny, slapped fines and announced probes into deals involving Alibaba and Tencent Holdings Ltd.

Advancing issues outnumbered decliners by 3.29-to-1 on the NYSE and 3.00-to-1 on the Nasdaq.

The S&P index recorded 20 new 52-week highs and no new low, while the Nasdaq recorded 152 new highs and five new lows.