The stocks rising most on the COVID-19 vaccine success
Energy and real estate stocks are among those rallying most on the vaccine announcement, having suffered as a result of the pandemic restrictions.
The first announcement of a successful vaccine trial came from Pfizer and BioNTech on 6 November followed by subsequent trials from Moderna and then from University of Oxford and AstraZeneca.
Since 6 November, the best-performing stock was Unibail-Rodamco Westfield which had risen 73% followed by three energy stocks – Oil Search, Worley and Santos.
According to FE Analytics, these four stocks all rose by more than 20% since 6 November, 2020, compared to returns by the ASX 200 of 7.5% with the best performer.
However, Bruce Apted, head of portfolio management- Australia active quantitative equities at State Street Global Advisors said, the performance of the stocks was ‘atypical’ to usual performance characteristics as the companies which performed the best since the start of the year underperformed the most and companies with the lowest levels of profitability outperformed.
Other stocks in those sectors which had seen a sharp recovery were Scentre Group, Vicinity Centres and Mirvac in the real estate space and Woodside Petroleum in the energy space.
Nine of the top 10 best-performing stocks had seen negative returns year to date however, the only exception was IDP Education which returned 46% since the start of the year.
Apted added: “We have seen a reversal of fortunes for those companies which have been impacted the most. They are now the companies with the most to gain from a vaccine. From a sector perspective, both energy and REITs are the biggest beneficiaries of the vaccine.
“Over the course of 2020, the gap between the COVID-19 winners and the COVID-19 losers became extreme. The recent price reaction to the positive vaccine news partly reflects the extreme pricing caused by the pandemic.”
AUTHOR
Laura Dew
Recommended for you
Outflows from an Australian private markets fund manager have caused FUM at Pacific Current to decline by $1 billion in the last quarter.
Former RIAA chief executive Simon O’Connor has joined the ethical advisory panel at U Ethical Investors.
Financial services leaders are “all cashed up with nowhere to grow” when it comes to M&A activity, according to Deloitte, with 90 per cent saying they have strong balance sheets ready for an acquisition.
As fund managers are urged to diversify their product ranges, they are finding a faster way to do this is via an acquisition of existing firms but experts say it is not without potential culture clashes.
