We study the effects of a direct high-speed rail (HSR) service between two cities on investors and firms in China’s A-share markets. After an HSR introduction, retail investors make more cross-city web searches and block stock purchases of firms in connected cities. An HSR introduction also leads to less comovement among local stocks and more comovement between stocks in connected cities. Firms located in more central cities in the HSR network enjoy higher firm valuation, lower cost of equity, higher turnover, and better liquidity, in part through the channel of increased investor recognition. The HSR effects on capital market outcomes are more pronounced among small firms and when the connected city-pair distance is below 1,500 km, for which HSR is faster than flying. The findings highlight the importance of in-person interactions in financial markets.