Light at the end of the tunnel – Pfizer and BioNTech reported 95% efficacy in their coronavirus candidate, better than 90% initially reporting and topping rivals Moderna. The joint venture is set to ask authorization to begin inoculating the public shortly.
The cavalry – from these two efforts and others such as AstraZeneca and Johnson & Johnson – is on its way. However, production, storage, and distribution challenges mean a long road to the end of that tunnel. After the initial shot in the arm, markets looked back at grim reality.
COVID-19 cases continue rising in the northern hemisphere, hitting Europe, the US, and even Japan. Governors in various American states have begun introducing restrictions, following governments and regions in the old continent. The potential damage to economic activity – both from lockdowns and from consumer caution – is of concern.
Fear of “scarring” – long-term damage to the economy, are in play. In the US, lawmakers have yet to agree on a new fiscal relief package, leaving investors at the mercy of the virus development. Finally, there are some tentative signs that the surge seen from mid-October is hitting a standstill.
A daily average of around 160,000 cases is still worrisome and implies hospitals and mortalities – which lag infections – are set to rise. Moreover, as every technical trader knows, this may be a mere consolidation of the uptrend rather than a change of course.
Nevertheless, a pause is better than an extension of an uptrend. Also, measures already implemented by various states could still push the curve down.
Seeing the chart above could encourage investors to see the glass as half full than half empty.
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US covid cases show tentative signs of flattening, could help investors see glass half-full
