Markets React to COVID Vaccine News

Author: Jon Clarke - Bullion & Economics Editor

Published: 10 Nov 2020

Last Updated: 2 Feb 2023


The “breakthrough” by pharmaceutical firm Pfizer could potentially mean a vaccine is made available in the new year. News of the announcement caused huge upswings in stock markets but had the reverse effect on commodities.

credit: pixabay

Positive Results Following Vaccine Trials

The new vaccine, which is supposedly more than 90% effective, comes from the efforts of Pfizer and German biotech firm BioNTech. Roughly 10 million doses of the vaccine will be available in the UK by the end of the year with another 30 million already ordered. This is hoped to return the UK to normal by Spring, nearly a year after the UK’s first enforced lockdown.

Market Responses

The S&P 500 index rose 3% soon after trading opened, while the FTSE-100 rose nearly 4.5%. Some of the hardest hit sectors such as airlines and hotels were among the greatest recipients of the spike with British Airways’ parent company, IAG, saw a 38% increase in share price while Airbus rose 22%. Jet-engine maker Rolls-Royce rose by 55%.

Many of the businesses that grew during COVID suffered notable losses when the vacine news was released. Zoom fell roughly 19% while Netflix and Amazon dropped by 10 and 5%, respectively.

In the crypto markets, Bitcoin took a hit from its £12,007.05 high to £11,489.18 in the space of 5 hours.

Metal markets also suffered with gold falling from £1,488.85 to £1,412.37 and silver from £19.61 to £18.02. These losses wiped out the week’s previous gains that were made in the aftermath of the US election.

UK Ready for Vaccine Rollout

With news that the NHS is prepared for vaccine delivery, markets have begun to rally. It is still early days, so while news of a possible return to normality in the coming months, the full details of the vaccine and possible side effects are still to be released.

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