Pfizer’s news gives stocks a shot in the arm

Stock markets rallied worldwide Monday on brimming hopes that people will again return in full force to office buildings, shopping centers and other parts of pre-pandemic life after encouraging early data about a potential coronavirus vaccine.

The Standard & Poor’s 500 index closed up 41.06 points, or 1.2%, at 3,550.50 after Pfizer said an early peek at its vaccine data suggests the shots may be 90% effective at preventing COVID-19, though that doesn’t mean its release is imminent.

Markets worldwide also got a boost from a resolution to the long, market-bruising battle for the White House.

Treasury yields and oil prices burst higher as the vaccine news made investors feel confident about a stronger economic recovery on the way.

The yield on the 10-year Treasury shot up from 0.81% before the announcement to 0.93%, a big move for the bond market. U.S. oil jumped 8.5%.

Leading the way were stocks of companies that most need the economy and the world to return to normal for their profits to heal. An 11.6% surge for Chevron and 11.9% jump for Walt Disney, 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%, to 29,157.97.

Cruise operators and owners of office buildings and shopping centers were among the market’s biggest winners.

Carnival surged 39.3%, though it’s still down by more than half for 2020. It led a resurgence for “value stocks,” ones whose prices look cheap and had been 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 of 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 Monday. Apple fell 2%, for example, and Microsoft lost 2.4%.

Their losses accelerated at the end of trading, which helped drag down the S&P 500’s gains. The tech-heavy Nasdaq composite index slumped 181.45 points, or 1.5%, to 11,713.78.

Companies whose fortunes had soared because of pandemic stay-at-home measures fell sharply.

Zoom Video Communications, whose online meetings enable millions of remote students and workers to communicate, sank 17.4%. Grubhub, which benefited from people ordering in for dinner, dropped 10.9%. Etsy, whose online marketplace rode a wave of popularity for homemade masks, declined 17.1%.

Meanwhile, Pfizer jumped 7.7% as its announcement indicates the company and its German partner, BioNTech, are on track to file an emergencyuse application for their COVID-19 vaccine with U.S. regulators later this month.

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

Stock markets across Europe jumped more than 4%. In Asia, many markets rose more than 1%.