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Nasdaq up as tech shares surge

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The Nasdaq Composite rose more than 2% as shares of Amazon jumped 8%, after Goldman Sachs raised its price target on the e-commerce stock from $3000 to $3800

Stocks rose Monday as investors looked ahead to a packed week of earnings, stimulus talks and congressional testimony from Covid-19 vaccine developers.

The Nasdaq Composite rose more than 2% as shares of Amazon jumped 8%, after Goldman Sachs raised its price target on the e-commerce stock to $3800 from $3000. Other internet and software stocks also outperformed Monday afternoon.

The three major indices reacted mutedly after The Lancet medical journal published promising results of a Covid-19 vaccine study by the University of Oxford and AstraZenaca. Results of the Oxford-AstraZeneca study had been highly anticipated over the weekend, after reports that upbeat data would be published surfaced late last week. Earlier in the morning, Pfizer and BioNTech reported positive early data from their own Covid-19 vaccine study.

Over the weekend, coronavirus case and death counts rose again in the US, with the domestic death toll topping 140,000. Cases in Florida rose by more than 10,000 for a fifth straight day as of Sunday. California’s new cases rose by more than 9,300, or well above the 8,487 average over the prior two weeks, as the state struggled to reign in infections. In Texas, new cases rose by 7,300 as of Sunday, falling below the 10,000 mark for new cases for the first time since July 13.

With Congress returning from a more than two-week recess on Monday, lawmakers are set to begin discussions for another round of stimulus to help relieve individuals and companies impacted by the coronavirus pandemic. White House Chief of Staff Mark Meadows told Fox News on Sunday that the talks would begin at the White House at the start of this week, with Senate Majority Leader Mitch McConnell, Treasury Secretary Steven Mnuchin and House Republican Leader Kevin McCarthy present.

On Tuesday, officials from Merck, Moderna, Pfizer, AstraZeneca and Johnson & Johnson are set to testify on July 21 before the House Committee of Energy and Commerce to discuss their work in creating inoculations for Covid-19.

Investors are also gearing up for a packed slate of quarterly earnings results this week, which will reflect the extent of the damage the pandemic has done to corporate profits. Companies comprising about one-quarter of the S&P 500 are set to deliver earnings results in the coming week, representing one of the heaviest weeks of reports this quarter. About 13.9% of the S&P 500’s market capitalization reported second-quarter results as of this morning, with the big banks, Netflix and Johnson & Johnson among the big reporters last week.

As with the big banks that reported last week results will likely be mixed, identifying winners and losers in a tough environment of unprecedented dimension, Oppenheimer strategist John Stoltzfus said.

Second-quarter earnings per share are “projected to experience the greatest contraction of the current crisis, -43.0% versus the same quarter last year,” Credit Suisse strategist Jonathan Golub wrote in a note Friday. That said, company results have been topping forecasts by +13.0%, more than any quarter since 1Q10.

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