European stock markets and oil prices rocketed on Monday on coronavirus vaccine hopes following successful trials.

Already up strongly on Joe Biden's US election win, markets massively accelerated gains after Pfizer and its German partner BioNTech said their vaccine was 90 per cent effective in preventing Covid-19 infections.

London's benchmark FTSE 100 stocks index surged 4.8 per cent in midday deals.

In the eurozone, Frankfurt jumped 5.2 per cent and Paris soared 6.6 per cent.

Dow Jones futures were up 5.4 per cent ahead of the Wall Street open.

Share prices of airlines led the way, with British Airways parent IAG up more than 25 per cent.

Air France-KLM and Lufthansa made similar jumps — as the news came as a huge relief to a sector battered by virus travel restrictions.

'Spicy cocktail' 

"Stock markets surged on some extremely positive news from Pfizer and BioNTech," said Neil Wilson, chief market analyst at Markets.com.

"The Dow is now seen up 1,300 points (at the official open). Coming on top of the wave of relief from Joe Biden's victory, it's proving a spicy cocktail for stocks."

New York crude advanced 8.9 per cent and Brent North Sea oil was up 8.1 per cent.

The dollar was down versus the euro and pound — and up around 1.5 per cent against the yen.

US currency direction was influenced also by expectations of a big spending bill and American interest rates being kept at record lows for the foreseeable future.

Gold futures, seen as a safehaven investment, were down two per cent.

Biden effect 

Stock markets began rallying on Monday as Biden's election win reduced uncertainty and provided hope that the US would finally agree on a stimulus package to prop up the ailing economy. 

While Democrat Biden has secured enough votes for victory, Republican rival Donald Trump has refused to accept defeat, with legal challenges and recounts looming. 

Oanda analyst Craig Erlam said Trump's actions are seen by markets "as achieving nothing more than delaying the inevitable".

Stocks already began surging last week as it became apparent that Biden was on course for victory and that Republicans would likely hold the Senate, allowing them to rein in any big regulatory or tax policies.

On Monday in Asia, Tokyo's main stocks index closed up more than two per cent to end at a 29-year high before the seismic Pfizer announcement.

Hong Kong, Shanghai, Sydney, Singapore and Seoul all gained more than one per cent, while Bangkok rose over two per cent.

Focus on stimulus 

Traders are looking to Capitol Hill, hoping for a fresh rescue package for the US economy after lawmakers failed to hammer out anything ahead of the vote despite months of haggling.

"More fiscal support is likely forthcoming," said Invesco strategist Brian Levitt. 

"While it may not be the outsize fiscal package that the Democrats had envisioned, it will likely be large enough to provide an additional boost to the economic recovery."

Analysts said a new stimulus was crucial for helping the economy as coronavirus spreads rapidly through the United States, with almost 10 million people having contracted it there.