News, Views & Truths (04/10/21)

Published on: October 4, 2021

Hello everyone, once again and I sincerely hope that you have all had a wonderful weekend.  Me? Well, I have been getting over the “reopening” cold that seems to be cutting a swathe through the population, although I am now raring to go and fighting fit.  Kind of.

Anyway, let’s get into this week’s News Views and Truths.

Looking back at the depths of the pandemic, the summer of 2020 offered global markets very little direction.  The effects of the pandemic were unknown and the only certainty was that the global fiscal burden was growing beyond all pre-Covid expectations.  

A catalyst for change was needed and that came in the form of the vaccines.

On the 20th November 2020, Pfizer and BioNTech submitted an emergency use authorisation request to the US Federal Drug Agency (FDA) for their Covid-19 vaccine, with approval given December 11th.  This was a gamechanger as we all now know, both for the reopening of the economy and the recovery of the markets.  And perhaps we have just seen another one.

German pharmaceutical company Merck, along with Ridgeback Biotherapeutics announced on Friday that they have developed a pill that, in tests, reduces the risk of hospitalisation or death by around 50% in Covid patients.  The drug, Molnupiravir works by inhibiting the replication of the coronavirus inside the body and Merck is now seeking emergency authorisation for use.

An interim analysis of a phase 3 study found that 7.3% of patients treated with Molnupiravir were hospitalised within 29 days. Of the patients who received a placebo, 14.1% were hospitalised or died by day 29. No deaths were reported in patients who were given Molnupiravir within the 29-day period, while eight deaths were reported in placebo-treated patients.

Furthermore, Molnupiravir’s efficacy was not affected by the timing of symptom onset or patients’ underlying risk factors, the study showed. It also proved to be consistently effective in treating all variants of Covid, including the delta variant.

This announcement was extremely positive for Merck stock, with a surge of 8.4% in Friday’s trading.  However, its rivals did not fare so well with Moderna falling 11.4% and BioNTech dropping 6.7%.

But the broader effects could be significant, perhaps even a game-changer…   

The data produced by the Merck study, to date, has been hugely significant and could ultimately provide relief to industrial stocks that have been struggling due to supply chain issues.  Furthermore, despite the easing of lockdown measures, we still have not seen the anticipated rebound in travel and leisure stocks.

And once again, like the vaccine announcement last year, we will not see the results until we have them clearly in our rear-view mirror.  But if anything, it’s positive and I love positivity.

That’s it for another week, aside from our usual playlist.  Stay safe and I shall see you all in seven days, if not before…

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