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* Analog Devices rises on $21 billion deal to buy rival Maxim
* Pepsi gains as results beat on higher demand for snacks
* Pfizer, BioNTech get ‘fast track’ status for vaccine candidates
* Futures up: Dow 0.74%, S&P 0.69%, Nasdaq 0.87% (Adds quote, details; updates prices)
By Medha Singh and Devik Jain
July 13 (Reuters) - Wall Street’s main indexes were set to rise on Monday as Pepsi kicked off the second-quarter earnings season on an upbeat note, with investors also cheering signs of progress in COVID-19 vaccine development.
Shares of German biotech firm BioNTech jumped 9.2% in premarket trading and U.S. pharmaceutical giant Pfizer climbed 2.4% as two of their experimental coronavirus vaccines received the U.S. FDA’s ‘fast track’ designation.
“There are renewed expectations that the Pfizer vaccine will be ready for approval by the end of October, which is sooner than expected - so that’s very good news,” said Thomas Hayes, managing member at Great Hill Capital LLC in New York.
Merger news also perked up investors as Analog Devices Inc announced a $21 billion deal to buy rival Maxim Integrated Products Inc, sending its shares up 17% in premarket trading. Analog shares rose 0.2%.
Pepsi Co gained 2.6% as it benefited from a surge in at-home consumption of salty snacks such as Fritos and Cheetos during lockdowns.
“The market is sniffing out that the worst is behind us and is looking forward to earnings and guidance, which will more than likely beat very low expectations,” Hayes said.
Still, 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 the coronavirus-induced lockdowns on corporate profits. With a record jump in cases in the United States and some other hotspots around the world, analysts have predicted a return to S&P 500 earnings growth only by 2021.
Recent economic data, however, has pointed to a revival in business activity, helping the Nasdaq clinch its sixth record close in seven weeks on Friday as broader markets rose on positive data from Gilead’s potential COVID-19 treatment.
The S&P 500 is about 6% below its own record high hit in February.
At 8:18 a.m. ET, Dow e-minis were up 193 points, or 0.74%. S&P 500 e-minis were up 22 points, or 0.69% and Nasdaq 100 e-minis were up 93.75 points, or 0.87%.
Tesla Inc jumped 6.2%, 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. (Reporting by Medha Singh in Bengaluru; Editing by Saumyadeb Chakrabarty)