Optimism that a mass rollout of Covid-19 vaccines will lead to an economic recovery lifted stocks in London again on Tuesday, to their highest closing level in over four months. London’s FTSE 100 index of blue-chip shares rallied by nearly 1.8% to finish at 6,296 points, the highest close since 23 June. This added £28bn to the index’s value, taking its gains so far this week to nearly £100bn after it surged 4.6% on Monday on news of a vaccine breakthrough. Investors continued to snap up stocks, such as airlines, transport companies and hospitality firms on Tuesday, hoping for a return to normality in 2021. Monday’s promising clinical data from Pfizer and BioNTech, showing their Covid-19 vaccine was 90% effective in medical trials, produced a second day of gains for certain businesses and helped shares in jet engine-maker Rolls-Royce gain 7% to their highest level since June. The parent company of British Airways, IAG, rose almost 6% to a two-month high. Ocado, whose online grocery business has seen huge demand in the pandemic, fell 5%. The oil price rallied again too, with international benchmark Brent crude up 2% to $43.24 per barrel. This drove BP’s share 5% higher, with Royal Dutch Shell 4% higher. Among smaller companies, cinema chain Cineworld – whose UK and US screens are currently closed – jumped 18%. Food and drink operator SSP, which operates Upper Crust and Caffè Ritazza outlets at UK railway stations and airports, gained 13%, adding to Monday’s 51% leap. Tuesday’s rally came as the UK government outlined that dedicated GP clinics will be set up to each deliver nearly 1,000 Covid-19 vaccines a week in England, if they are approved for use. “The post-pandemic world that at times this year has looked a distant dream is suddenly a little in sight, following the Pfizer/BioNTech announcement yesterday and investors are seeing some value in those companies whose business plans have been decimated this year,” said Craig Erlam, senior market analyst at currency trader OANDA Europe. Erlam cautioned that there are still major hurdles to overcome, including final regulatory approval and the challenge of distributing many millions of doses. Other European markets showed smaller gains, with France’s CAC jumping 1.5% and the German DAX finishing 0.5% higher. The FTSE 100 has been one of the worst-performing major stock indices since the pandemic began, and is still 16% lower than at the start of January. But growing hopes of a vaccine mass rollout soon are pushing investors into “value” stocks again. In New York, the Dow Jones industrial average gained ended up 1.06% at 29,467.94. The tech-focused Nasdaq dropped by 1.12%, to 11,582.35. Peter Garnry, head of equity strategy at Saxo Bank, said Pfizer’s vaccine trial results “gave a big jolt to equity markets”, boosting the energy, financials, and industrials sectors at the expense of technology stocks. “European equities are benefiting the most from the vaccine as the European economies are hit hard from Covid-19 and generally European equities are more cyclical than the overall US equity markets,” Garnry explained. But in the long term, big tech is still the fastest growing segment of the market, Garnry added. “US technology stocks have had explosive earnings growth since 2009 while also being more immune to crises such as the euro area crisis in 2011-2012, emerging markets in 2015, and lately Covid-19.”