• Market Crumbs

Moderna Coronavirus Vaccine Provides Hope

Image via Imgflip

For the better part of 2018 and 2019, headline writers in the financial media attributed the stock market's gains to "hopes of a trade deal" between the U.S. and China.

As of late, the financial media has decided bring back the constant "hope" headlines, attributing the stock market's gains from the March low to "hopes of a COVID-19 vaccine" and "hopes of a strong economic recovery."

While the real reason has more to do with accommodative policies from central banks, yesterday saw the former headline as markets surged on hopes of a coronavirus vaccine from Moderna.

Moderna announced its vaccine candidate produced COVID-19 antibodies in all 45 participants in the trial. Moderna split the participants into three groups of 15, with the groups receiving 25, 100 or 250 microgram doses. The participants were given two doses of the vaccine candidate 28 days apart.

At day 43, two weeks after the second dose, participants in the 25 and 100 microgram group saw levels of antibodies seen in people who have recovered from the coronavirus. Participants in the 100 microgram group had antibodies that "significantly exceeded levels" in recovered patients. Data for the second dose was not yet available for those participants who received the 250 microgram dose.

"These interim Phase 1 data, while early, demonstrate that vaccination with mRNA-1273 elicits an immune response of the magnitude caused by natural infection starting with a dose as low as 25 [micrograms]," Moderna chief medical officer Dr. Tal Zaks said.

"When combined with the success in preventing viral replication in the lungs of a pre-clinical challenge model at a dose that elicited similar levels of neutralizing antibodies, these data substantiate our belief that mRNA-1273 has the potential to prevent COVID-19 disease and advance our ability to select a dose for pivotal trials," Zaks said.

Moderna, which is the first company to release data from human trials for a COVID-19 vaccine, expects to begin a phase 3 trial in July.

Moderna said if the vaccine is found to be effective, it could be ready in early 2021.

Moderna shareholders appear to be optimistic about the company's vaccine candidate. Moderna, which reported $60 million in revenues in its latest full year, now sports a market capitalization of nearly $30 billion.

The news from Moderna caused shares of Gilead Sciences, which has also received heightened attention from investors for its coronavirus candidate remdesivir, to fall to the lowest level since April 13.

With markets placing so much hope on Moderna's vaccine candidate, hopefully it can prove to be an effective treatment against the coronavirus which has killed more than 300,000 people worldwide.

Leftover Crumbs

  • Powell doesn't see a depression. Fed Chairman Jerome Powell painted a dire picture of the U.S. economy on 60 Minutes, but said he doesn't think a second depression is "a likely outcome at all." Powell said the U.S. economy could shrink as much as 30% while the unemployment rate could mirror that of the Great Depression when it peaked near 25%. "It should be a much shorter downturn than you would associate with the 1930s," Powell said. "So in the long run, I would say the U.S. economy will recover," Powell said. "We’ll get back to the place we were in February; we’ll get to an even better place than that. I’m highly confident of that. And it won’t take that long to get there."

  • Uber lays off more employees. After laying off 14% of its global workforce a few weeks ago, Uber announced it will lay off another 3,000 employees, leaving the company with about 20,000 employees globally. Uber also announced it will close or consolidate 45 offices around the world and is considering cuts to other business units. "Having learned my own personal lesson about the unpredictability of the world from the punch-in-the-gut called COVID-19, I will not make any claims with absolute certainty regarding our future," Uber CEO Dara Khosrowshahi said.

  • The new normal at Apple. As Apple prepares to reopen its retail stores, the company provided a list of guidelines that customers can expect. Customers will be required to wear a face mask and have their temperature checked before being able to enter. If a customer doesn't have a face mask, Apple will provide them with one. Apple will also limit occupancy and focus on "one-on-one, personalized service." Apple said store reopenings will be determined by local guidelines and Apple's own data, and could close again if shutdown orders are reinstated.

  • SoftBank posts record loss. SoftBank Group continues to deal with the fallout of poor investments in companies such as WeWork and Uber as the conglomerate posted a record annual loss with its Vision Fund losing $18 billion. The losses at WeWork and Uber contributed to nearly $10 billion in losses between them. "The coronavirus is an unprecedented crisis," SoftBank Group founder and CEO Masayoshi Son said. Son added that some of the fallen tech unicorns have fallen "into the valley of the coronavirus."

  • Japan falls into recession. Japan fell into a recession for the first time since 2015 as the world's third-largest economy contracted by a 3.4% annualized rate in the first quarter. The contraction in the first quarter follows an annualized 7.3% drop in the fourth quarter, meeting the definition of a recession which is consecutive quarters of contraction. Exports fell by 6%, which is the most since the second quarter of 2011 following the March 2011 earthquake.