Few things are as encouraging as a glimpse at the light at the end of the tunnel. Pharmaceutical makers Pfizer and BioNTech announced Monday morning that their coronavirus vaccine has shown strong results through ongoing drug trials – a 90% efficacy rate with minimal side effects. This news immediately gave lift to the markets, adding another historic moment to a year chock-full of them.
It’s said markets hate uncertainty, but that wasn’t the case last week.
Despite tremendous uncertainty about the outcome of the United States election, major domestic and international stock indices moved higher and the CBOE Volatility Index, better known as Wall Street’s fear gauge, moved 35 percent lower.1 Ben Levisohn of Barron’s reported:2
The equity market hit a year-to-date high in June but was tempered by emerging coronavirus cases as states slackened their isolation orders, ending with a near flat month after three months of sustained rebound from the March 23 low.
As coronavirus restrictions ease and businesses reopen, the American economy should gain steam. Data released in May and June, including employment, payroll, and manufacturing numbers, suggested the economy may have hit bottom in April.1