Dow closes more than 800 points higher; S&P 500 up 1.17 percent on Pfizer vaccine news, election

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Financial markets soared Monday, in a relief-fueled global rally as clarity emerged on the two concerns that have gnawed on investors for months: the presidential election and rampaging coronavirus.

Stocks rocketed higher after the pharmaceutical giant Pfizer said early data showed its coronavirus vaccine appeared 90 percent effective. The news followed Joe Biden’s election as the 46th president of the United States on Saturday, a sign that the American vote — which some investors worried could spiral into a chaotic period of political contestation if President Donald Trump lost — appeared to proceed more or less normally.

On Wall Street, the S&P 500 was up more than 3 percent at 1:25 p.m. — on track to close at a record high. The Dow Jones Industrial Average surged more than 1,300 points, or 4.5 percent.

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The benchmark Stoxx Europe 600 index surged 4 percent, led higher by energy companies in its biggest one-day gain since March, while the FTSE 100 in Britain rose more than 5 percent. In Asian markets, which closed before Pfizer announced its news, the Nikkei 225 in Japan ended the day 2.1 percent stronger, and the Hang Seng index in Hong Kong finished up 1.2 percent.

Markets were already higher before Pfizer’s release, which said a vaccine it was developing with BioNTech was found to have been more than 90 percent effective in preventing COVID-19 infections, based on a large study. Pfizer said by the end of the year, it will have manufactured enough doses of the vaccine to immunize 15 million to 20 million people. Pfizer jumped more than 6 percent.

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Scientists have cautioned against hyping early results before long-term safety and efficacy data has been collected, and no one knows how long the vaccine’s protection might last. Still, the development makes Pfizer the first company to announce positive results from a late-stage vaccine trial, and news of the vaccine sent shares of companies most heavily hit by restrictions on travel surging. American Airlines jumped 22 percent and United Airlines rose 23 percent. Carnival, the cruise ship operator, rose 36 percent.

The vaccine is “an important piece of the puzzle needed for the global economy and markets to put the COVID-19 recession behind it,” said Karen Ward, a strategist at JPMorgan Asset Management. “Hurdles still remain. We need to find out more about production capabilities, rollout and takeup. But for now, this is shifting the winners and losers.”

Crude oil prices were also catapulted nearly 10 percent higher to more than $40 a barrel. Prices for government bonds — where investors traditionally park funds during times of uncertainty — tumbled sharply, pushing yields, which move in the opposite direction, to some of the highest sustained levels in months. The rise in yields reflects growing optimism among investors on the outlook for economic growth.

Trading on Monday followed the best week for the S&P 500 since April, as investors became more convinced that President-elect Biden would govern alongside a Republican-held Senate. However, two runoff elections in Georgia mean the control of the Senate will not be known until January.

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“With more certainty around the election, a strong quarter of earnings across many sectors, and extremely positive news on the vaccine front, there is little to hold us back,” said Chris Larkin, managing director of trading and investment products at E-Trade Financial. “When you remove the virus from the equation, we are set up tremendously well for growth.”

This article originally appeared in The New York Times.