Stocks rally with hopes for return to ‘normal’

NEW YORK — Brimming hopes that people will again return to office buildings, shopping centers and normal life sent markets rallying worldwide on Monday, following encouraging data about a potential coronavirus vaccine.

The S&P 500 rose 41.06, or 1.2 percent, to 3,550.50 after Pfizer said its vaccine data suggests the shots may be 90 percent effective at preventing COVID-19, though that doesn’t mean its release is imminent. The index at the heart of many 401(k) accounts had been up as much as 3.9 percent earlier in the day, though it pared its gain in the last hour of trading amid drops for the Big Tech stocks that dominate the market.

Markets worldwide also got a boost from a resolution to the long, market-bruising battle for the White House. Democrat Joe Biden over the weekend clinched the last of the electoral votes needed to become the next president. Investors say they just wanted a clear winner to emerge, instead of rooting for one of the two, but a Biden administration constrained by a Congress under split control will likely offer a balance of more predictable policies.

Treasury yields and oil prices burst higher as the vaccine news allowed investors to feel confident about a stronger economic recovery on the way. The yield on the 10-year Treasury shot up from 0.81 percent before the announcement to 0.93 percent, a big move for the bond market. U.S. oil jumped 8.5 percent.

Stocks of companies that most need the economy and the world to return to normal for their profits to heal led the way. An 11.6 percent surge for Chevron and 11.9 percent jump for The Walt Disney Co. amid hopes that people will start driving and flying to theme parks again helped the Dow Jones Industrial Average climb 834.57 points, or 2.9 percent, to 29,157.97.

Cruise operators and owners of office buildings and shopping centers were among the market’s biggest winners on expectations people will feel comfortable again riding elevators to a desk or shopping in enclosed stores.

Carnival surged 39.3 percent, though it’s still down by more than half for 2020 so far. It led a resurgence for “value stocks,” ones whose prices look cheap and had gotten left behind by the rest of the market through the pandemic.

“People are buying those because they see a light at the end of the tunnel,” said Todd Morgan, chairman at Bel Air Investment Advisors.

The Big Tech companies that earlier drove the market higher in the pandemic, in large part because they didn’t need a “normal” economy to succeed, lagged behind. Apple fell 2 percent, for example, and Microsoft lost 2.4 percent.

Their losses accelerated at the end of trading, which helped drag down the S&P 500’s gains. They also sent the Nasdaq composite to a loss of 181.45 points, or 1.5 percent, to 11,713.78.

Companies whose fortunes soared directly because the pandemic kept everyone hunkered at home fell sharply.

Grubhub, which benefited from people ordering in for dinner, dropped 10.9 percent. Etsy, whose online marketplace rode a wave of popularity for homemade masks, lost 17.1 percent.

Building on last week’s gains, the S&P 500 is up 8.6 percent in November. Still, analysts caution that several risks remain that could trip up the market’s big recent gains.

In markets around the world, stocks strengthened amid expectations that a Biden-led White House could tamp down trade tensions that had built under Trump’s administration.