Stocks surged around the world and bonds tumbled after a large-scale coronavirus vaccine study delivered the most-promising results in the battle against the worst pandemic in a century.
The S&P 500 climbed toward a record amid trading volume that was 160% above the 30-day average on news the coronavirus shot being developed by Pfizer Inc. and BioNTech SE prevented over 90% of infections. The Dow Jones Industrial Average was also on track for an all-time high while the Russell 2000 Index of small caps jumped about 6%.
Shares that have been hit hard by the economic toll of lockdowns such as travel stocks and movie theaters soared, with Carnival Corp. and Cinemark Holdings Inc. up more than 35%. Stay-at-home companies Zoom Video Communications Inc. and Peloton Interactive Inc. sank at least 14% on hopes that a return to normal is on the horizon. Online giant Amazon.com Inc. slid.
Equities came off session highs after Mayor Bill de Blasio said New York City is coming "dangerously close" to a second wave of COVID-19, spurring speculation of potentially tougher restrictions as cases in the U.S. topped 100,000 for a fourth day.
Meanwhile, several block sales in 10-year Treasury futures added fuel to the pressure on notes, with the benchmark rate soaring to the highest since March. A measure of credit-market risk eased to pre-pandemic levels, and junk-rated companies hit the market in droves to take advantage of a plunge in borrowing costs. Oil surged, while gold, the Japanese yen and the Swiss franc slumped. The dollar rose.
Investors pulled out of haven assets and poured cash into markets that are closely tied to economic growth, with a gauge of global stocks also hitting a record high.
President-elect Joe Biden announced a new coronavirus task force as his transition team seeks to fulfill a campaign promise to develop a dramatically different approach than President Donald Trump's to contain the pandemic. He warned of a "dark winter" and many more deaths as the coronavirus continues to spread unabated.
The top infectious disease expert in the U.S., Anthony Fauci, said the vaccine being developed by Pfizer will have a "major impact" on everything we do with regards to COVID-19 going forward.