- Markets are struggling with the ramifications of COVID-19 for the global economy.
- China is facing a second potential wave of coronavirus infections.
At the start of the week, the markets applauded the moves towards a possible breakthrough for a vaccine for COVID-19. We heard that the volunteers who received the Moderna vaccine had positive early results, according to the biotechnology company, which has partnered with the National Institutes of Health to develop the vaccine.
However, as markets waited to hear more welfare headlines about the prospects for a possible vaccine to be made available to the public as early as January, a report by Stat News ran cold water in the news Tuesday. Quoting experts, according to Stat News, focused on health, the experiment would not provide the essential data necessary to assess its effectiveness. The concerns noted by Stat were:
– a lack of data on the drug responses of the other participants in the study of 45 subjects
– the lack of information on the age of the eight subjects whose antibodies were analyzed, an important question given that the virus is particularly fatal for the elderly
– no comments from the United States from Moderna, government partner in the vaccine, the National Institute of Allergy and Infectious Disease
– the data are based on early responses to the vaccine, which does not allow us to know how long an immunity produced by the vaccine could last.
Moderna did not immediately respond to a request for comment from Reuters. The share price took a hit and fell 10.4% on Tuesday night to almost reduce a 13% increase on Monday, which closed it at an all-time high.
New waves of viruses are expected
After months of travel restrictions and restrictions, China has largely mastered the virus. However, the chief medical adviser to the Chinese government has warned that China is facing a potential second wave of coronavirus infections due to a lack of immunity in its population. Fears of a second wave increased with the emergence of clusters in the northeast provinces and the central city of Wuhan.
“The majority of … Chinese people today are still susceptible to COVID-19 infection due to (a) lack of immunity,” Zhong Nanshan, the public face of the government’s response to the pandemic, told CNN.
“We are facing a (big) challenge,” added Zhong. “It is not better than foreign countries I think at the moment.”
COVID-19 Chinese Updates
- China reports 5 new cases of COVID-19 on the continent at the end of May 19 (compared to 3 days earlier).
- Report 1 new case of COVID-19 imported to the continent (compared to 3 the day before).
- Reports 16 new asymptomatic cases of COVID-19 on the continent (compared to 17 a day earlier).
It’s too easy to get caught up in the hysteria of geopolitical headlines, but the fact is that the macro is much easier to predict and trade than the very ruthless and fickle political headlines or COVID-19 updates who can shoot there. during the day. No one wants to be pessimistic, but a touch of realism is essential and keeping a cool and analytical head will go a long way toward avoiding bad trades.
The World Health Organization said earlier this year that it would take at least 18 months before a coronavirus vaccine is released. Perhaps the markets are too eager to return to positive levels and get too far ahead of themselves?
At the start of the week, we looked at the American benchmarks as a guide and the 61.8% Fibonacci retracements:
This level is indeed proving to be a difficult area of resistance and the path of least resistance is probably down if investors start to assess the reality of the broader risks associated with the state of the world economy.