Stocks hit all-time highs on optimism about vaccine

Stocks surged around the world and bonds tumbled after a large-scale coronavirus vaccine study delivered the most-promisingresultsin the battle against the worst pandemic in a century.

More than 85% of S&P 500 companies climbed Monday as the gauge jumped to a record on news that the COVID-19 shot being developed by Pfizer Inc. and BioNTech prevented more than 90% of infections. The enthusiasm also drove the Dow Jones Industrial Average to an all-time high and sparked a rally in small caps.

At 11:10 a.m. New York Time, the S&P 500 was up 2.57% at 3,599.53. The Dow Jones Industrial Average was up 3.76%, or 1,065.95 points, at 29,389.35.

Shares that have been hit hard by the economic toll of lockdowns such as travel stocks and movie theaters jumped, with Carnival Corp. and Cinemark Holdings Inc. surging more than 35%. Stay-at-home companies Zoom Video Communications Inc. and Peloton Interactive Inc. plunged at least 16% on hopes that a return to normal is on the horizon. Online giant Amazon.com Inc. retreated.

A credit derivatives index that measures the perceived risk of high yield dropped by the most in seven months, with junk-rated companies hitting the market in droves to take advantage of a plunge in borrowing costs. Oil soared, while gold, the Japanese yen and the Swiss franc slumped.

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 Monday announced a new coronavirustask forceas his transition team seeks to fulfill a campaign promise to develop a dramatically different approach than President Donald Trumps to contain the pandemic.

Anthony Fauci, the top infectious disease expert in the U.S., said the vaccine being developed by Pfizer will have a major impact on everything we do with regards to the coronavirus going forward.

The bull market has a ton of ammunition to keep going, said Chris Larkin, managing director of trading and investing product at ETrade Financial. 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.

Elsewhere, the Australian dollar-yen cross — a commonly watched risk barometer — surged by most since June. The Turkish lira soared after the weekend resignation of the countrys economy czar and the dismissal of the central bank chief.

[More: Election outcome seen as bullish for emerging markets]

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