US Stocks Attain New Heights after the Moderna Vaccine Data Announcement

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With the announcement of Moderna’s phase three Covid-19 vaccine trial data, the US stock market witnessed a record rise on Monday. The trial data suggests that the vaccine produced to counter the novel coronavirus by the pharmaceutical giant has been significantly effective. With this announcement, Wall Street’s S&P 500 index ended the day with by a 1.2% rise, while the Russell 2000 of the US small-cap stocks also closed at a record level. The latter is considered to be a barometer of the domestic economy. The economically sensitive markets have been stimulated by the hope that a covid-19 vaccine will effectively annihilate the spread of the virus. A powerful rotation has set in to the more economically sensitive sectors. Investors have now started moving away from groups considered to be the beneficiaries of the pandemic.

Rise of Value

Energy and financial stocks were the leading victors in this eventuality, followed by travel stocks. Shares of the biggest US airlines witnessed an accentuation of 4%-5%, while the stocks of cruise liners advanced further. After this announcement, Moderna’s shares went up 11% while Pfizer’s fell by 4%.

Words from Experts

Dan Suzuki, Deputy Chief Investing Officer at Richard Bernstein Investors, commented on the Moderna announcement subsequently followed by the rise of stock evaluations saying, “That’s a reflection of increased likelihood of and visibility into the normalisation of corporate profits and lifestyles in 2021.” Hani Redha, a portfolio manager at PineBridge Investments, also predicted that the money that had been set aside by investors over the raging issues of the ongoing pandemic and the US election results, will now be invested into the sectors that are most likely to grow.

Optimistic Future

The Moderna trial data indicates a high rate of effectiveness for their vaccine against the novel virus. With a 94.5% rate of preventing infections, the Moderna vaccine holds the highest rate of approval than the other forerunners in the vaccine race, including Pfizer. This announcement has enabled the stock market and shareholders to be cautiously optimistic about the future of their investments and business ventures resulting in a much needed boost in the economy.