What’s the Chance ?: Goldman Sachs: How the Chances of a Corona Vaccine Affect the Stock Market | message
indices in this article
Hope for vaccine drives markets
Disappointing news hits investors hard
Goldman Sachs strategists are optimistic
After investors ventured out of cover after the Corona low in March and returned to the stock markets, there was a comparatively quick recovery. Hopes for a vaccine repeatedly supported the upward trend, but at times accompanied the stock market events rather in the background. Time and again, the first buyers secure large quantities of vaccine doses that will be available in the future, studies are meanwhile being started and some are also being canceled. There is still no method of treatment or immunization that can improve long-term health outcomes. But strategists at the US investment bank Goldman Sachs estimate that the chances in this direction are now good.
Corona: vaccine hope among Goldman strategists
As MarketWatch reports, predictions put the likelihood of an imminent breakthrough in the vaccine search at 40 percent. According to the Goldman Sachs strategists, it could be the case by the end of November that the US Food and Drug Administration approves such a policy. Based on this assumption, the team leader Kamakshya Trivedi predicts: In the course of the first half of 2021, the drug for immunization should then become widely available. Economically, the optimistic scenario would have a positive impact: “Such a time frame could increase GDP [Bruttoinlandsprodukt] compared to a ‘non-vaccine’ case, especially for the US, which is likely to lead the vaccine race and likely to get worse results than in Europe without vaccine. ”
Important factors not correctly assessed?
Although there is currently no corona vaccine in prospect, the stock markets have stabilized relatively, the strategists summarize the past trading days and weeks. A non-vaccine scenario has a 60 percent chance, according to strategists at Goldman Sachs. Could investors be misjudging the chance of a vaccine? At least that is what the MarketWatch customer announcement suggests. “With these estimates, options markets could undervalue the obesity of both tails, particularly the upside. Out-of-the-money call options on the S&P 500 (and some other indices) always look good given our view of the vaccine’s timing results still attractively rated, “they say.
The elections in the USA would be underestimated in the same way – less the domestic, much more the international point of view. The “international effects both in the run-up to the election and afterwards will be just as important for the market orientation in the coming months”, say the experts. The relationship with China in particular is the focus of interest. The current conflict over TikTok and Co. has recently intensified, which is another addition to the disused trade dispute.
Postponement – Tech Rally vs. vaccine
The strategists also suggested that the risks associated with the imminent reopening of schools in the United States could further fuel or prolong currently critically discussed issues. This included not only the low real interest rates, but also the tech rally and the defensive recovery on the markets. “But as some of these moves are dragging on, investors should be open to the possibility of a change in leadership in global markets in the coming months, especially if the news flow on the vaccine front remains encouraging,” the strategists said.
Finanzen.net editorial team
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