News of the Pfizer vaccine is spreading like wildfire around the world today. Covid-19 has killed more than 1.2 million people the world over. Today, Pfizer announced a vaccine that has a 90% effective rate with no serious safety concerns. If these numbers are to hold true, Pfizer’s new vaccine would hold up to the childhood disease vaccines like measles. Additionally, Pfizer says it expects to have 15 to 20 million vaccines ready in the US by year’s end provided the FDA issue emergency authorization later this month. They also predict to have over 100 million doses ready worldwide.[1]
Markets reacted to the news positively today and Pfizer rocketed up 14.1%. The DOW jumped 1,610 points or 4.4% and is on pace to have its highest point day climb in history. Both the Nasdaq and the S&P 500 were also positive with jumps of 1.3% and 3.3% respectively. As one would expect, tourism related businesses soared and big tech lost. Cruise lines, airlines, and oil were market winners while big tech, specifically stay-at-home tech, tumbled.[2]
As mentioned, airliners and Boeing were the next big winners in the market in the wake of the vaccine news. Southwest was the lowest riser, but still managed a boost of 15%. Other major airliners were up anywhere from 15-22% and Boeing settled around 12%.[3] US oil was also a big winner next to the tourism related industry, jumping nearly 11% to $41.22/bbl. The main driver is expected to be a recovery in demand, explicitly relating to jet fuel and gasoline. Additionally, Brent crude spiked 9% to $42.80/bbl.[4] Conversely, big tech was the biggest loser and the reason the Nasdaq was lagging in a bullish market. Companies that surged under stay-at-home mandates, (Amazon, Netflix, Teladoc Health, etc.) showed declining stocks anywhere from 6.4 – 3%. The biggest loser in the wake of vaccine news was Zoom, falling 15% on pre-market activities. [5]
Time will ultimately decide the fate of the market. Time will allow us to determine if the vaccine numbers hold true. Time will tell if tourism spikes as predicted IF the vaccine remains effective, and time will tell if this can all be done at “Warp Speed.” If the FDA authorizes emergency administration of the vaccine worldwide, this may very well prove to be the modern day “shot heard round the world.”
[1] https://www.nytimes.com/2020/11/09/health/covid-vaccine-pfizer.html
[2] https://www.cnn.com/2020/11/09/investing/dow-stock-market-today/index.html
[3] https://www.cnbc.com/2020/11/09/airlines-surge-on-upbeat-vaccine-news-american-jumps-19percent-.html
[4] https://www.cnn.com/2020/11/09/investing/oil-prices-vaccine-pfizer/index.html
[5] https://www.cnbc.com/2020/11/09/zoom-and-other-stay-at-home-stocks-are-getting-crushed-on-the-positive-vaccine-news.html
