Futures tied to the Dow Jones Industrial Average, the S&P 500, and the Nasdaq rose 0.5%, indicating that blue-chip shares might prolong Monday’s rally that lifted the benchmark indexes toward record highs.
There is still a long way to go until a vaccine might be widely rolled out. But Pfizer’s announcement “gives investors some hope that a vaccine could arrive sooner than anticipated, and pave the way to some kind of normality,” Milan Cutkovic, a market analyst at Axi, said.
Mark Haefele, the chief investment officer at UBS Global Wealth Management, said the market’s reaction highlighted the need for investors to diversify for the next leg toward more cyclical parts of the market that had lagged in 2020 and away from big tech and the primary stay-at-home beneficiaries. He said the next leg up in stocks would be driven by an end to US political uncertainty and the sustainable increase in global mobility that a vaccine could bring.
US Attorney General Bill Barr has authorized federal prosecutors to begin investigations into voter fraud and irregularities, in a major break from American political norms. Investors may not be taking this too seriously, however, Connor Campbell, a financial analyst at SpreadEx, said.
In Europe, Rolls-Royce was the top performer on London’s FTSE 100, rising 24%, followed by British Airways’ owner, IAG, which rose 6.6%.
A large part of the region is still in partial or full lockdown, and Cutkovic said that for the sake of consumer and business confidence it was crucial to avoid a back-and-forth between different restriction levels.