- Global stocks rose on Monday as the head of the White House’s Operation Warp Speed said some Americans would be able to receive coronavirus vaccinations by mid-December.
- Investors are betting that positive developments in trials of COVID-19 vaccines might mean swift regulatory approval and a quick rollout.
- The greatest potential is in the sectors with scope to “catch up” as the vaccine rollout and policy support facilitate economic recovery, said UBS’ Mark Haefele.
- AstraZeneca said on Monday that its vaccine candidate is 70% effective.
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Global stocks rose on Monday as investors bet on a swift approval and distribution of multiple vaccines, which could help bring the pandemic under control.
Futures on the Dow Jones, S&P 500, and the Nasdaq rose between 0.4% and 0.7%, pointing to a modestly higher start to trade later in the day. The major indices closed lower on Friday.
Moncef Slaoui, the head of the White House’s Operation Warp Speed, said on Sunday some Americans would be able to receive vaccinations as soon as December 11, meaning that there could be a 70% immunization rate across the US by May.
A nascent rotation from technology stocks to value sectors in equity markets and an ongoing rally in industrial metals and oil suggest these asset classes are focused on the reflationary possibilities of a vaccine rollout, said Stephen Innes, chief global market strategist at Axi.
“An emerging risk for investors is an untimely withdrawal of support for the US’ real economy, just as social-mobility restrictions undermine activity for the second time this year,” he said.
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AstraZeneca’s shares slid after it announced its COVID-19 vaccine shot is 70% effective, compared to Pfizer and Moderna’s success rates of above 90%.
London’s FTSE 100 rose 0.3%, the Euro Stoxx 50 rose 0.6%, and Germany’s DAX rose 0.8%.
The greatest potential is in the sectors with scope to “catch up” as the vaccine rollout and policy support facilitate an economic recovery over the coming year, said Mark Haefele, chief investment officer, UBS Global Wealth Management.
US Treasury Secretary Steve Mnuchin last week suggested unspent stimulus money could be used to extend unemployment benefits and assist hard-hit small businesses in the travel, entertainment, and hospitality sectors.
Continuation of US fiscal stimulus talks, hopes that the first COVID-19 vaccine will get rapid FDA approval lifted Asian stock markets as well.
China’s Shanghai Composite rose 1% and Hong Kong’s Hang Seng rose 0.2%. Japan markets were closed for a holiday.
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