Dow rockets 1,434 points to a record high as Pfizer's COVID-19 vaccine shows stunning effectiveness

Xinhua/Wang Ying/ Getty Images
  • US stocks soared to record highs on Monday after Pfizer said its COVID-19 vaccine showed more than 90% efficacy in its phase 3 trial that enrolled 44,000 patients.
  • Both the S&P 500 and Dow Jones industrial average opened at intraday all-time highs.
  • The development is seen removing significant uncertainty from the market in terms of seeing a light at the end of the COVID-19 pandemic tunnel.
  • While cyclical stocks in the airlines, restaurants, and financial sectors soared, popular work-from-home names like Zoom, Peloton, and Netflix plummeted.
  • Watch major indexes update live here.

COVID-19 vaccine progress proved on Monday to be what the stock market needed to hit new highs. Both the S&P 500 and Dow Jones industrial average opened at intraday records.

The surge comes after Pfizer and BioNtech announced that their phase 3 trial of a COVID-19 vaccine showed more than 90% effectiveness in preventing the illness, setting itself up for an emergency rollout to help quell the COVID-19 pandemic.

More than 44,000 patients were enrolled in the phase 3 trial of the vaccine, and no serious safety concerns were observed throughout the trial.

Pfizer and BioNtech are now ramping up production of the vaccine. They expect to produce more than 50 million vaccines by the end of the year, and more than a billion doses in 2021.

Here’s where US indexes stood shortly after the 9:30 a.m. ET open on Monday:

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The vaccine progress rippled through various areas of the stock market. Pfizer itself soared 13% as investors expect the company to benefit from the swift rollout of their effective vaccine.

The cyclical reopening trade also fuelled much of the gains on Monday morning. Travel-related airline and cruise line stocks surged as investors likely anticipate pent-up demand for travel once the vaccine has been widely administered. Further, AMC Entertainment Holdings led a broad rally in movie theatre stocks, spiking roughly 48% on Monday morning.

Berkshire Hathaway soared 7% on stock purchases, record buybacks, and the Pfizer vaccine.

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On the flip side, work-from-home stocks suffered on the news, as people are more likely to spend less time at home and get back into the office once the COVID-19 pandemic is in the rear view mirror. Zoom, Peloton, Docusign, and Netflix cratered significantly on Monday.

Biogen plummeted 32% after votes from the FDA Advisory Committee reduced the chances of its Alzheimer’s therapy from receiving approval early next year.

Oil prices soared. West Texas Intermediate crude climbed as much as 11%, to $US41.33 per barrel. Brent crude, oil’s international benchmark, jumped 10%, to $US43.48 per barrel, at intraday highs.

Gold slid on Monday, falling as much as 4.2, to $US1,868.97 per ounce.

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