Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Analysis: As Omicron plays havoc with markets, shares of vaccine makers surge

Stock MarketsNov 30, 2021 03:36PM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: A healthcare worker places vials containing doses of the "Comirnaty" Pfizer BioNTech and Moderna vaccines against the coronavirus disease (COVID-19) on a table at a vaccination centre in Ronda, Spain November 10, 2021. REUTERS/Jon Nazca

By Lewis Krauskopf

NEW YORK (Reuters) - The emergence of a worrisome coronavirus variant is benefiting shares of vaccine makers Moderna (NASDAQ:MRNA) Inc, BioNTech and Pfizer (NYSE:PFE) as investors search for winning bets in markets roiled by uncertainty in recent days.

Moderna shares have jumped 28% since last week when the variant, named Omicron, triggered global alarm. Shares of vaccine partners Pfizer and BioNtech have also climbed over that time, with Pfizer up 6% and U.S. shares of BioNTech jumping 15%, in contrast to a decline in the S&P 500 of 2.5%.

Moderna and Pfizer/BioNTech are the predominant vaccines used in the United States, and it is expected they will be able to re-engineer their products to address the new variant if required.

“They are clear COVID plays and anything that ramps up the intensity of COVID is going to benefit them," said Kevin Kedra, pharmaceuticals analyst at GAMCO Investors. "They are the front line of defense against COVID.”

Along with the rise in vaccine stocks, the market reactions to the new variant included a sell-off in travel and leisure stocks and brief increases in stay-at-home stocks that thrived during lockdowns in 2020.

The companies have already reaped enormous profits from their vaccines, juicing their stock prices this year. Moderna shares are up 240%; shares of Pfizer, which also is seeking emergency authorization for its experimental antiviral COVID-19 treatment, are up 47%, while BioNTech has seen a 340% gain.

Buying vaccine stocks is part of "a playbook that we have learned over the last 18 months, give or take. I think it is more mechanical than thoughtful,” said Les Funtleyder, a healthcare portfolio manager at E Squared Capital.

“We don’t have all the information. People are jumping the gun," Funtleyder said. "They may be making the right choice, but we are not going to know for a little while."

Much remains uncertain about Omicron, including how contagious it is, whether it will cause more severe disease than other variants and how protective existing vaccines are against it.

The head of Moderna, Stéphane Bancel, said vaccines are unlikely to be as effective against Omicron as they have been against previous variants, while BioNTech's chief said the company's vaccine would likely offer strong protection against any severe disease from the new variant.

Kedra said Bancel's comments may have been one factor weighing on shares of Moderna and BioNTech on Tuesday. Moderna was down 5% and BioNTech was down 3%.

Pfizer's shares were up 3.5% Tuesday.

Analysts have been scrambling to assess the business implications from the new variant.

“It seems much more likely that we are going to have at least one more round of boosters," said Daina Graybosch, senior research analyst at SVB Leerink.

Jefferies (NYSE:JEF) analyst Michael Yee said in a note that the "emergence of Omicron represents an increase in need for continued protection against COVID-19 and its variants through the use of primary vaccination for some, and administration of boosters for many."

The emergence of Omicron has also reverberated through shares of makers of treatments for COVID-19. Vir Biotechnology (NASDAQ:VIR), which said its antibody therapy will likely maintain potency against the variant, has seen its stock rise some 45% since last week.

Shares of Adagio Therapeutics have soared 130% in volatile trading over that time. The company said it expects its experimental antibody therapy will retain activity against Omicron.

Regeneron (NASDAQ:REGN) Pharmaceuticals said on Tuesday its antibody drug could be less effective against Omicron and was doing further study to quantify the potential impact using the variant's genetic sequence. Regeneron shares have fallen 1% since Omicron emerged.

Analysis: As Omicron plays havoc with markets, shares of vaccine makers surge
 

Related Articles

Goldman Sachs adds another layer of stress
Goldman Sachs adds another layer of stress By Reuters - Jan 19, 2022

A look at the day ahead from Julien Ponthus. For all the turmoil across financial markets yesterday, the Nasdaq creeping dangerously near correction territory and closing below a...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (1)
Bill Riley
Bill Riley Nov 30, 2021 4:26PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
So far, there have been no reported deaths linked to the omicron variant. Meanwhile, many countries including the U.S. have reimposed some travel restrictions in an effort to stem the spread of the new variant. Don't be afraid any more
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email