'Long road ahead' despite positive COVID-19 trial
Markets are overreacting to the news of a COVID-19 vaccine as there is still a “long road ahead” before it is available to the public.
It was announced overnight that US pharma Pfizer and German biotech firm BioNTech had invented a vaccine that was 90% effective in tests. This news caused the FTSE 100 to rise by 5.5% and the S&P 500 by 3.9%, both countries significantly affected by the pandemic.
But Nigel Green, chief executive of deVere Group, said markets were being too premature about the news.
“The vaccine development reports are, obviously, an important step in the right direction.
“However, I suspect the markets – which are already in a bullish mood due to the incoming Biden administration – are overthinking the positive vaccine news. They are being premature in their buoyancy.
“There’s a long road ahead still. We will find out in the third week of November then as we wait to see if the vaccine can be approved or not.”
He said there were trends in the world now such as remote working which would be unlikely to reverse even if a vaccine was successful which would have a long-term impact on shares in those sectors.
“The world is still readjusting and many of the changes that have come about from the pandemic are unlikely to be reversed, including the workplace revolution in which more and more people are working from home.”
AUTHOR
Laura Dew
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