Stocks Skyrocket Amid Pfizer's Report On Effectiveness Of A Coronavirus Vaccine
Stocks soared to record highs after drugmaker Pfizer announced its experimental coronavirus vaccine was more than 90% effective, providing a major dose of hope for the global economy.
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Euphoria broke out on Wall Street today following the news of that successful vaccine trial. The Dow and the S&P 500 soared to record highs early in the day before giving up some of their gains. But here's a twist. Stocks for companies that have benefited from stay-at-home orders, like Zoom, Netflix and Amazon - their share prices cratered. NPR's Jim Zarroli reports.
JIM ZARROLI, BYLINE: Stocks went gangbusters as soon as the market opened. There was no secret why.
QUINCY KROSBY: So it's encouraging. It's promising, and it takes us to the other side of the pandemic.
ZARROLI: Quincy Krosby, chief market strategist at Prudential Financial, says the announcement this morning of a successful vaccine test by Pfizer is a huge potential game-changer.
KROSBY: It's still going to take time for the economy to come back full-steam. It's not going to happen overnight, but this is the underpinning for the recovery of the global economy.
ZARROLI: The vaccine holds the promise of unlocking parts of the economy that have been mostly shut down since March. Restaurants, hotels, theaters - all of those places where people gather in large numbers - and companies that have been most hurt by the pandemic came roaring back today. United Airlines soared 19%. The theater chain AMC shot up 51%.
KROSBY: These were the laggards, the ones pummeled by the COVID-19 lockdown.
ZARROLI: But the opposite has happened with companies that benefited from the lockdowns. Throughout the pandemic, people have been working out at home on their Peloton bikes. They've been bingeing on Netflix, and hundreds of millions of people take part in Zoom calls every day. But with the possibility that life may return to normal, those stocks tanked. Peloton plunged 20%. Zoom was down 17%.
But it wasn't just the vaccine that sent prices soaring. The announcement over the weekend that former Vice President Joe Biden has become president-elect lifted a veil of uncertainty over the market. Glenn Hubbard, a former top adviser to President George W. Bush, says the election makes it more likely that Congress and the White House can agree on another stimulus bill, which investors like. But it will make some other things Democrats want harder to achieve.
GLENN HUBBARD: A divided government would still yield some additional fiscal measures - maybe not as much as an all-Democratic government - and might take off the table some significant tax increases.
ZARROLI: When he was running for president, Biden proposed raising taxes on businesses and the rich. He also favored a public health insurance option. Both are unpopular with investors. Unless Democrats can win two more Senate seats, Republicans are likely to make sure neither of them happens, and Wall Street is fine with that.
Jim Zarroli, NPR News.
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