Monday's early afternoon trade: Dow rises; tech mega-caps slide

• Tesla close to hitting $500 billion in market cap

• Surging coronavirus cases cap stock market gains

NEW YORK: The blue-chip Dow rose in choppy trading on Monday as hopes of a Covid-19 vaccine fueled demand for economically-sensitive stocks such as energy and industrials, while a sell-off in technology heavyweights weighed on the S&P 500 and the Nasdaq.

Six of the 11 major S&P indexes were trading higher by early afternoon, with industrials and energy jumping 1.2% and 4.6%, respectively, as data showed monthly business activity expanded at the fastest rate in more than five years.

The communication services and information technology indexes were among the biggest decliners as investors rotated out of the tech mega-caps that were seen as safe bets following a coronavirus-led crash earlier this year.

"The vaccine is the driving factor in terms of the general optimism," said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida.

"(But) you are going to get a little bit of back and forth as this is a holiday week and typically we are going to get lot more volatility."

Evidence of high efficacy rates in experimental Covid-19 vaccines had lifted the S&P 500 to a record high this month and brought the blue-chip Dow close to breaching 30,000 points for the first time.

AstraZeneca Plc became the latest major drugmaker on Monday to say its vaccine could be around 90% effective, while in the United States, the health regulator is likely to approve in mid-December the distribution of the vaccine made by Pfizer Inc.

The CBOE volatility index, known as Wall Street's fear gauge, edged lower to hover near levels last seen in August.

"November has been that month when we were finally convinced that there is light at the end of the tunnel (and) today is another one of those days," said Art Hogan, chief market strategist at National Securities in New York.

Kicking off a trading week shortened by the Thanksgiving holiday on Nov. 26, the Dow Jones Industrial Average was up 0.64%, at 29,450.81. The S&P 500 was up 0.18%, while the Nasdaq Composite was down 0.05%.

Sentiment was dented by new lockdowns to contain a surge in coronavirus infections with Nevada on Sunday becoming the latest state to tighten curbs on casinos, restaurants and bars, while imposing a broader mandate for face-coverings over the next three weeks.

Meanwhile, hopes of more monetary stimulus were dampened after Treasury Secretary Steven Mnuchin last week pulled the plug on some of the Federal Reserve's pandemic emergency lending programs.

Tesla Inc surged 5.7%, inching closer to hitting $500 billion in market capitalization ahead of its inclusion in the S&P 500 next month.

Advancing issues outnumbered decliners 2.90-to-1 on the NYSE and 1.95-to-1 on the Nasdaq. The S&P index recorded 26 new 52-week highs and no new low, while the Nasdaq recorded 146 new highs and eight new lows.