By Joe Wallace and Akane Otani 

Stocks slipped Monday but held on to hefty gains for the month, capping off a furious November rally fueled by investors' bets that scientists are closer than ever to finalizing Covid-19 vaccines to fight the pandemic.

The market's momentum faded on the final trading day of November, with the Dow Jones Industrial Average falling 365 points, or 1.2%, around midday.

But even with Monday's slide, stocks remain on track for historic gains. The blue-chip average is up nearly 12% for the month, which would mark its biggest gain since January 1987. The S&P 500 is headed for a 10% gain and the Nasdaq Composite is up 11% for the month.

With officials in the U.S. looking close to approving the distribution of multiple vaccines, many money managers are betting on the economy being able to recover lost activity over the next year. Signs that President-elect Joe Biden will make a relatively smooth transition into the White House have also helped ease some of the political uncertainty that had fed into heightened market volatility in the fall.

In a sign of investors' optimism, shares of companies that had suffered most from the pandemic, such as energy producers and banks, have posted steep gains. The Russell 2000 index of small-cap stocks is on pace for its best month since its 1984 inception.

Monday's stock slide shows the market rally isn't immune to setbacks. Surging coronavirus infections in the U.S. and the possibility for logistical hiccups in the distribution of the shots could lead to further bouts of selling. And some investors wonder what will fuel stocks higher from here, now that big question marks, like the elections and the likelihood of a successful vaccine, appear to be in the rearview mirror.

Still, many strategists expect that investors will ultimately view any declines as a buying opportunity.

"We've got a lot of very good vaccine news," said Daniel Morris, chief market strategist at BNP Paribas Asset Management. "We should, for the most part, move up between now and the end of the year, with a chance for a setback here or there.

Shares of drugmaker Moderna jumped 16% Monday after saying it would ask U.S. and European health regulators to authorize use of the company's Covid-19 vaccine.

IHS Markit rose 8% after the data provider said it would combine with S&P Global in a deal that values IHS Markit at $44 billion, including debt. The all-stock deal is the largest of the year.

Shares of oil-and-gas companies declined broadly alongside crude prices, chipping into outsize gains for the month. The S&P 500 energy sector remained up 29% for November, despite falling 3.4% Monday.

One risk for stocks in the coming months stems from exuberance among individual investors, said Trevor Greetham, head of multi asset at Royal London Asset Management, pointing to surveys by the American Association of Individual Investors. Still, the U.K. asset manager is betting that a revival in economic activity will continue to buoy stock prices in 2021.

The prospect of vaccines offers "some light at the end of the tunnel as an investor," Mr. Greetham said. "If you're buying stocks, you're not just assessing the next month or two -- you're assessing the next 20 years."

In Asia, investors were rattled by a Reuters report that the Trump administration is poised to add oil producer Cnooc and chip maker Semiconductor Manufacturing International to a blacklist of alleged Chinese military companies. Cnooc shares tumbled 14% in Hong Kong, while SMIC's Hong Kong-listed stock fell 2.7%.

Most major markets in the region ended lower. Hong Kong's Hang Seng lost 2.1%, Japan's Nikkei 225 retreated 0.8% and the Shanghai Composite Index lost 0.5%.

Markets are concerned about more restrictions from the U.S. on investing in Chinese companies, according to Steven Leung, executive director of institutional sales at UOB Kay Hian in Hong Kong.

"Some investors would rather stay on the sidelines awaiting more clarity on vaccine developments and U.S. policy directions as the nation transits to new leadership," Mr. Leung said.

Banks and energy producers dropped in Europe, weighing on the Stoxx Europe 600, which finished down 1%.

--Joanne Chiu contributed to this article.

Write to Joe Wallace at and Akane Otani at


(END) Dow Jones Newswires

November 30, 2020 12:41 ET (17:41 GMT)

Copyright (c) 2020 Dow Jones & Company, Inc.