The S&P 500 and Nasdaq Composite indexes closed at record highs on Tuesday, with investors betting a COVID-19 vaccine will be available soon, and more confident about a speedy economic recovery following upbeat Chinese factory data.

Investors stayed focused on updates about a handful of vaccine candidates and the start of global shipments as drug makers submit paperwork for regulatory approvals.

Pfizer Inc. jumped by almost 3 percent after the drug maker and Germany's BioNTech SE sought emergency approval of their vaccine candidate from the European regulator.

The partners are neck-and-neck with rival Moderna Inc., which also applied for emergency approval from the European regulator. Its stock tumbled by nearly 8 percent from a record high the day before.

"There is this optimism about what it means as we see news around vaccines emerge," said Bill Northey, senior investment director of the U.S. Bank Wealth Management in Minneapolis.

"As we look toward a health solution, we could be sitting on a coiled spring of economic activity, but it could take a while for it to be unleashed."

Earlier in the day, global equities got a boost from data that showed China's factory activity in November increased at its fastest pace in a decade. Several other countries also reported sharp upticks in factory activity.

U.S. data showed a recovery in manufacturing activity lost momentum in November.

All 11 S&P 500 sector indexes rose, with communication services up 2 percent and leading gains.

Investors also focused on remarks by U.S. Treasury Secretary Steve Mnuchin and Federal Reserve Chair Jerome Powell at the Senate Banking Committee, where they agreed on the need for more aid for small businesses.

Meanwhile, a bipartisan group of U.S. lawmakers unveiled a $908-billion COVID-19 relief bill aimed at breaking a months-long deadlock between Democrats and Republicans over new emergency assistance for small businesses, unemployed people, airlines and other industries during the pandemic.

The Dow Jones Industrial Average rose by 0.63 percent to end at 29,823.92 points, while the S&P 500 gained by 1.13 percent at 3,662.44.

The Nasdaq Composite climbed by 1.28 percent to 12,355.11.

All three main stock indexes gained by more than 10 percent in November.

Zoom Video Communications Inc. slumped by 15 percent after warning its gross margins would remain under pressure going into 2021.

Tesla Inc. rose by 3 percent after S&P Dow Jones Indices said it would add one of Wall Street's most valuable companies to the S&P 500 index in one go on December 21, rather than in two tranches.

Micron Technology Inc. advanced by 4.7 percent as the chipmaker increased its revenue, gross margin and earnings forecast for the first quarter.

Advancing issues outnumbered decliners on the NYSE by a 2.45-to-1 ratio; on Nasdaq, a 1.38-to-1 ratio favored advancers.

The S&P 500 posted 48 new 52-week highs and no new lows; the Nasdaq Composite recorded 185 new highs and eight new lows.

Volume on U.S. exchanges was 13.5 billion shares, compared with the 11.5 billion average over the last 20 trading days.

(Cover: A small shopping basket filled with vials labeled "COVID-19 – Coronavirus Vaccine" and medical syringes are placed on a U.S. flag, November 29, 2020. /Reuters)