The Press release by Albert Bourla of Pfizer on the 9th November was possibly the best and certainly the most welcome news the world has received in this dreadful year of the Pandemic.
The efficacy rate of 90% for the Covid-19 Vaccine that Pfizer have developed was significantly better than expected and opens the door for a gradual normalisation of social and business interaction as early as Spring 2021. The data to be able to apply for FDA Emergency Use Authorisation will be available by the 3rd week in November and the indication is that a targeted vaccination programme will be in operation as early as December.
In the e-mail we sent on the 8th September, we indicated that the 3 significant headwinds that were holding back the progress of investment markets were Covid-19 and the lack of a way to defeat or at least protect ourselves from the virus, the uncertainty about the outcome of the US Presidential Election and uncertainty about the outcome of Brexit negotiations. Two of these headwinds have now been removed from the equation and investment markets have reacted very positively to the news.
Brexit and the potential impact of no deal, is still with us but it is clear that progress is being made and the lack of incendiary comments by both sides indicates that a deal is possible and is being worked on. The election of Joe Biden, who has made his views on the sanctity of protecting the Irish peace process very clear, has made the necessity of getting a deal done even more important for the UK.
Early indications from some Economists are that the rebound in economic activity will get business activity back to pre-COVID levels as early as Summer 2021. I would be delighted if this turned out to be the case but it is important not to get ahead of ourselves at this early stage.
The overall backdrop is now more positive for risk assets on a medium-term outlook as pent-up demand builds and normalised activity gradually returns. This is an environment where balanced and multi-asset investment strategies should have the potential to do well.
Through this difficult period Scott and I have been advocating staying invested for the longer-term to be able to participate in the market rises when they occur and with hindsight and the benefit of experience of similar market volatility this strategy has again proven to be correct.
As has been said before, we are here to provide you with advice specific to your circumstances, so if you have any questions please get in touch.
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