US STOCKS-S&P 500, Dow close higher on vaccine update, retail sales beat

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By Stephen Culp
NEW YORK, Oct 16 (Reuters) - The S&P 500 advanced on Friday
as further clarity regarding the timeline for the development of
a coronavirus vaccine and much better-than-expected retail sales
data and brought buyers back to the market.
The Dow also joined the S&P in positive territory, both
indexes snapping a three-day losing streak driven by halted
vaccine trials and continued wrangling in Washington over a new
pandemic relief package. But the Nasdaq ended the session
slightly lower.
Even so, they all posted gains on the week.
Pfizer Inc PFE.N announced it could apply for U.S.
authorization for the COVID-19 vaccine it is developing with
German partner BioNTech 22UAy.F in November. "The two highest-level market movers are the vaccine
timeline and stimulus optimism," said Ross Mayfield, investment
strategist at Baird in Louisville, Kentucky. "Sometimes the
market gets a reality check that even if we get a vaccine early
next year that's an incredibly aggressive and optimistic
timeline."
Retail sales USRSL=ECI in September blew past analyst
expectations and consumer sentiment for the current month
surprised to the upside, according to two separate economic
reports. But with previous stimulus having run its course, the
outlook is uncertain unless Washington can reach an agreement on
a fresh round of fiscal aid. "It's important from the retail sales data to see that the
consumer is not just limping a long but exceeding expectations,"
Mayfield added. "I don't know how long this can continue without
stimulus but it's heartening to see the consumer has held up
pretty well despite some dire expectations."
On the stimulus front, U.S. Treasury Secretary Steven
Mnuchin told House Speaker Nancy Pelosi that President Donald
Trump would "weigh in" with Senate Majority Leader Mitch
McConnell if an agreement is reached on a new pandemic relief
package. House Republican leader Kevin McCarthy, however, said
he does not expect an agreement to be reached ahead of the Nov.
3 election as long as Pelosi is involved. Unofficially, the Dow Jones Industrial Average .DJI rose
110.01 points, or 0.39%, to 28,604.21, the S&P 500 .SPX gained
0.58 points, or 0.02%, to 3,483.92 and the Nasdaq Composite
.IXIC dropped 42.32 points, or 0.36%, to 11,671.56.
Third-quarter reporting season burst from the starting gate
this week, with 49 of the companies in the S&P 500 having
reported. Of those, 86% have cleared the low bar set by
expectations, according to Refinitiv.
Analysts now see S&P 500 earnings for the July to September
period dropping, in aggregate, by 18.7% year-on-year, an
improvement from the 21.4% plunge estimated at the beginning of
the month, per Refinitiv.
Schlumberger NV's SLB.N shares dipped after posting its
third straight quarterly loss due to falling crude prices and
plunging demand. Railroad operator Kansas City Southern KSU.N and
transportation and logistics company J.B. Hunt Transport
Services Inc JBHT.O fell after the companies' quarterly
results were hit dropping shipping demand. The Dow Jones Transport index .DJT , considered a barometer
of economic health, also lost ground. Shares of fitness company Peloton Interactive Inc PTON.O
slipped after announcing a recall of faulty pedals on its
popular exercise bikes.