Dow (INDU) futures soared 1,500 points, or 5.1%. S&P 500 (SPX) futures were up 3.5%. Yet Nasdaq (COMP) futures were only 0.6% higher as many tech stocks that benefited during stay-at-home orders went into reverse.
Pfizer’s much-better-than-expected vaccine efficacy announcement, albeit an early look at its data, is just what Wall Street had been hoping for. The coronavirus pandemic has caused historic economic turmoil across the globe, and cases are surging to new records every day. That threatens to tip the scales and send the US economy heading in the wrong direction once again.
Although the vaccine is not set to be widely administered soon, Pfizer said it plans to seek emergency use authorization from the US Food and Drug Administration soon after volunteers have been monitored for two months following their second dose of the vaccine.
Pfizer’s (PFE) stock surged 12% in premarket trading.
The vaccine news was good for pharmaceutical stocks, including Dow components Merck and Johnson & Johnson, both of which were higher before the bell. Cruise lines also soared — Norwegian (NCLH) and Carnival (CCL) were both up more than 30% before the market opened, and Royal Caribbean (RCL) was more than 20% higher. Airline stocks soared, too.
But the news also sent some stocks were tumbling, including Zoom, which has benefited from the stay-at-home work culture since the spring. Zoom (ZM) shares tumbled 15% in premarket trading.
Other companies that have performed well during the pandemic, including Amazon, Netflix and Clorox, fell. Amazon (AMZN) shares were down more than 3%, and Clorox (CLX) and Netflix (NFLX) sank 5%.
Oil, which had been plunging as the economy took a turn for the worse, was up 8% Monday morning.
Betting on Biden
Stock futures had already been higher with the uncertainty of the election mostly in the rearview mirror.
The stock market had been predicting a Joe Biden win for more than a week, but stock futures nevertheless were sharply higher Monday even before Pfizer announced its good news about the vaccine. Markets’ first reaction to Biden’s official projection as the winner was a positive one.
Although President Donald Trump continues his legal fight and unsubstantiated claims of election fraud — and the fate of the Senate remains up in the air — Wall Street was pleased that a great deal of uncertainty is out of the way.
Investors have been pleased, too, that Republicans could keep control of the Senate, likely hindering Biden’s ability to raise taxes and increase regulation.
— CNN Health’s Nadia Kounang contributed to this report
