A largely positive week for stock markets continued with a strengthened rally yesterday as optimism rose around progress being made with two separate Covi-19 vaccines. In the UK the FTSE 100 gained 1.8%. Elsewhere in Europe Germany’s Dax closed to the same return and France’s CAC 40 added 2%.
That positive trend continued across the Atlantic later in the day where the three major Wall Street indices all recorded solid upticks. The S&P 500 and Dow Jones industrial average added 0.9% each and the tech-heavy Nasdaq 0.6%. The Nasdaq, almost unbelievably, is now up 17.6% for the year.
Early stage trials for a vaccine produced by American biotech company Moderna this week produced results showing it is both safe and leads to an immune response. The development was commented on as “good news”, by Anthony Fauci, director of the US National Institute of Allergy and Infectious Diseases. Moderna’s share price was yesterday up 6.9%.
The other vaccine positive progress is being made on is being developed by the University of Oxford in partnership with FTSE 100 pharma giant Astrazeneca. The latter will be responsible for the mass production and distribution of an eventually approved vaccine. Encouraging data from trials is due to be published in the medical journal The Lancet in coming days.
Astrazeneca’s share price closed up 5.2% yesterday to within touching distance of the company’s record high, set in May. The pharmaceuticals company is currently the UK’s most valuable business and is one of a select group to have recorded strong gains over the course of 2020.
Another boost to investor sentiment cam from a strong quarterly earnings report by Goldman Sachs. All of the big U.S. banks are reporting this week as earnings season kicks off and a few more positive announcements like that of Goldman Sachs yesterday is likely to stoke optimism at least the financial sector is coming out of lockdown in reasonable shape. The bank’s share price gained 1.4%.
UBS Global Wealth Management chief invest officer Mark Haefele is confident that stock markets can continue to trend higher throughout earnings season, though it may not be a smooth ride. He commented:
“While we believe negative news on the pandemic and geopolitics will contribute to volatility, we think equities can continue to trend higher. China’s imports increased in June for the first time since the pandemic started, adding to evidence that the economic recovery is gaining traction.”
The Oxford University and Astrazenica partnership are at the most advanced stage of all those pursuing an approved Covid-19 vaccine and hope to be able to commence mass manufacturing and distribution from September.
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