US stocks surged higher at the open on Monday, with all three major indices breaking records after Pfizer announced that its vaccine was 90 percent effective in protecting against COVID-19 infections.
But the enthusiasm calmed somewhat pulling back the early gains, although maintaining a solid rise.
About 30 minutes into the trading session, the bellwether Dow Jones Industrial Average had jumped 4.4-percent to 29,553.62, still beating the closing record set February 12 of 29,551,42.
The broader S&P 500 rose 3.0-percent to 3,615.71, beating its September 2 closing record.
The tech-heavy Nasdaq spiked to a new record but then slipped back and was up 0.7 percent to 11,976.95.
With spiking coronavirus cases worldwide forcing millions of people back into lockdowns, the vaccine news offered hope the economy could begin to return to normal in coming months, and that was reflected in the stock movements.
Travel shares like cruise companies gained ground, along with pharmaceutical shares, while the videoconference service Zoom that millions of people have relied on during the pandemic fell sharply, dropping 15.5 percent.
Briefing.com analyst Patrick J O’Hare noted the vaccine news overtook news about the US presidential election, in which Democrat Joe Biden unseated President Donald Trump’s bid for a second term.
“From the stock market’s standpoint, the revelatory gist of the vaccine news is that it has fueled a sense of hope that life could truly take on a ‘return to normal’ feel in 2021,” O’Hare said.
“Accordingly, huge gains are being registered in areas like travel and entertainment stocks and industrial issues while sizable losses are being seen in many of the work-from-home/stay-at-home stocks.
Pfizer shares gained 7 percent, after spiking as high as 17 percent in trading prior to the open.
Meanwhile, fast-food chain McDonald’s shot higher after reporting better-than-expected quarterly earnings, but eased back and were up 0.9-percent.
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