Petrotahlil - European chemicals stocks jumped on Monday following an update from pharmaceutical major Pfizer on its coronavirus vaccine that stoked hopes for and to the pandemic in 2021.
An announcement from the US-headquartered firm that the coronavirus vaccine it is developing in partnership with German immunotherapy specialist BioNTech is at least 90% effective based on clinical trials sent markets surging at midday UK time.
European chemicals stocks rallied sharply on the news and the STOXX 600 chemicals index, with 22 large chemicals names, was up over 3.8% as of 14:10 GMT, compared to Friday’s close.
The chemicals index was slightly underperforming gains of 5.53%, 5.89% and 7.81% for the UK’s FTSE 100, Germany’s DAX, and France’s CAC 40 indices.
Spain's IBEX 35 was up nearly 9%, with stocks in its beleaguered tourism and travel sector rising up to 30%.
Among the major publicly listed chemicals, with the exception of DSM, Symrise, EMS-Chemie and Brenntag, all firms in the index saw a bounce from stock market ebullience, with Germany-based major BASF seeing some of the strongest gains with an increase of over 10% compared to Friday’s close.
LANXESS and Bayer were also among the top performers on Monday, with shares jumping 9.31% and 8.39%.
Crude oil prices also jumped sharply after the news was announced. Brent crude futures were trading at around $40.74/bbl at midday UK time, while US benchmark WTI was trading at $38.42/bbl.
Brent and WTI futures prices jumped nearly $3/bbl in the hour following Pfizer’s announcement, to $43.44/bbl and $41.30/bbl respectively, as of 13:30 GMT.
Pfizer evaluated 94 cases of Covid-19 in trial participants, with the data indicating over 90% vaccine efficacy in the seven days following the second dose.
43,538 participants have been enrolled in the phase three clinical trial so far, with no serious safety concerns noted.
The company intends to apply for Emergency Use Authorisation with the US Food and Drug Administration (FDA) after the final required safety milestone has been reached, currently expected in the third week of November.
The news of the efficacy of the treatment thus far and the potential for a speedy rollout of the treatment, along with the advanced stage of testing reached for other potential treatments such as the one being developed by AstraZeneca and Oxford University, has buoyed markets battered by the resurgence of the virus.
The rate of the spread of coronavirus across much of the world in recent months scotched market hopes that governments would be able to navigate through winter without being forced back into lockdown.
In the last couple of weeks, Germany has announced stronger restrictions that shuts down much of the services sector, while England in the UK, France, and Belgium are among the countries that have shifted back into full lockdown.
The developments have scotched hopes for a V-shaped economic recovery and are likely to undermine more bullish outlooks from observers such as the International Monetary Fund (IMF) this autumn.
Many lawmakers have been caught off-guard by the sheer rate of resurgence in coronavirus contagion, and few countries outside of the Asia Pacific region and Australasia have lowered daily infection levels sufficiently for something like normal life to resume.
Vaccines are seen as one of the only ways for much of the world to shift back to pre-pandemic rates of growth.
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