Dow Jones Rally Soars On Vaccine Hopes

Monday’s stock market gains were broad based, “real economy” stocks and sectors outperformed.

During the coronavirus stock market rally, tech and medical growth stocks have led, either as direct Covid-19 plays or as companies that could thrive during the pandemic. Meanwhile, real economy sectors such as travel, energy, auto, retail and banks saw demand plunge during the coronavirus lockdowns. But states and countries are opening up their economies without — so far — a surge in coronavirus cases. On Monday, Moderna (MRNA) touted quick progress on a vaccine candidate. That raises the prospect for a V-shaped economic recovery or something close to it.

As the coronavirus stock market rally looks ahead to a post-coronavirus economic recovery, real economy stocks may continue to lead, or at the very least participate. Direct coronavirus plays, such as Zoom Video (ZM) or Peloton Interactive (PTON), may hit headwinds. Investors should pay close attention to the overall stock market direction but also watch for shifting leadership.