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* Analog Devices rises on $21 bln deal to buy rival Maxim
* Pepsi gains as results beat on higher demand for snacks
* Pfizer, BioNTech get 'fast track' status for vaccine
candidates
* Indexes up: Dow 1.79%, S&P 1.26%, Nasdaq 1.34%
(Updates to early afternoon)
By Medha Singh and Devik Jain
July 13 (Reuters) - Wall Street's main indexes rose sharply
on Monday, with the Nasdaq at a fresh intraday record high, as
investors cheered signs of progress in COVID-19 vaccine
development and an upbeat start to the second-quarter earnings
season by PepsiCo.
Shares of German biotech firm BioNTech BNTX.O jumped 13.9%
and Pfizer Inc PFE.N climbed 5.4% as two of their experimental
coronavirus vaccines received the U.S. FDA's "fast track"
designation. "It's selective optimism as we enter earnings season,
chasing the same stocks that have been strong and looking
forward to earnings as market continues to have a narrow focus,"
said Andre Bakhos, managing director at New Vines Capital LLC in
Bernardsville, New Jersey.
Merger news also perked up investors as chipmaker Analog
Devices Inc ADI.O announced a $21 billion deal to buy rival
Maxim Integrated Products Inc MXIM.O , whose shares rose 11.2%.
Analog shares fell 3.8%. PepsiCo Inc PEP.O gained 2% as it benefited from a surge
in at-home consumption of salty snacks such as Fritos and
Cheetos during lockdowns. Investors are bracing for what could be the sharpest drop in
quarterly earnings for S&P 500 firms since the financial crisis,
according to IBES Refinitiv data. Results from big banks will be
in focus this week.
The April-June reports will reveal the extent of the damage
wreaked by coronavirus-induced lockdowns on corporate profits.
With a recent jump in cases in the United States that has made
Florida, Arizona, Texas and California the new epicenters,
analysts are predicting that S&P 500 earnings will return to
growth only by 2021.
The S&P 500, which is about 5% below its record high hit in
February, briefly turned positive for the year on an intraday
basis for the second time since the coronavirus-induced crash.
At 12:58 p.m. ET, the Dow Jones Industrial Average .DJI
rose 468.05 points, or 1.79%, to hit its highest level in nearly
four weeks at 26,543.35.
The S&P 500 .SPX was up 40.05 points, or 1.26%, at
3,225.09 and the Nasdaq Composite .IXIC gained 142.61 points,
or 1.34%, at 10,760.06.
Healthcare stocks .SPXHC rose 2.3%, the most among all
major S&P sectors trading higher.
Tesla Inc TSLA.O jumped 8.5% to $1,675.35, building on a
rally of nearly 25% in the past two consecutive weeks. Over the
weekend, it slashed the price for its Model Y SUV. A recent slew of encouraging economic data has strengthened
belief that the stimulus-pumped U.S. economy is on the road to
recovery, helping investors look past a recent spike in U.S.
infections.
"The market is treating these new cases like localized flare
ups, as opposed to a second wave," said Tim Chubb, chief
investment officer at Girard in West Chester, Pennsylvania.
Advancing issues outnumbered decliners by a 2.16-to-1 ratio
on the NYSE and by a 1.66-to-1 ratio on the Nasdaq.
The S&P index recorded 38 new 52-week highs and no new lows,
while the Nasdaq recorded 121 new highs and 15 new lows.
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