FTSE plummets as markets rocked by Moderna chief’s Covid warningNovember 30, 2021
Omicron: International travel restrictions criticised by expert
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Stéphane Bancel said there would likely be a “material drop” in vaccine efficiency. The FTSE 100 fell around 1.5 percent on the news while oil prices have also slid over fears of lower demand in response to potential restrictions. Saxo Bank’s Chief Investment Officer, Steen Jakobsen commented: “Brent crude oil, already heading for its biggest monthly loss since March 2020, trades below its 200-day moving average for the first time in a year, a sign that more weakness may lie ahead, thereby raising the prospect for OPEC+ deciding to pause or perhaps even make a temporary production cut.” Oil stocks have also been among the biggest fallers with BP and Shell both falling over 1.5 percent.
Travel stocks so far have resisted major declines with easyJet’s share price climbing back up following a brief dip after its annual results were released.
The airline reported a major loss but expects passenger growth to expand next year.
European markets have also been rocked with Eurozone-wide index Euro Stoxx 50 falling to its lowest level in over a month.
With doubt cast by a prominent player in the vaccine world pharmaceutical stocks have also suffered.
Senior Investment and Markets Analyst at Hargreaves Lansdown, Susannah Streeter said: “Amid the pessimism about the effectiveness of vaccines, AstraZeneca is among the biggest fallers on the FTSE 100 so far.
“Its vaccine has been produced at cost and now investors are clearly wondering if they will ever see a profit from this part of the business.”
Pfizer and its partner BioNTech however have struck a more positive tone saying last week they could produce and ship an updated version of their vaccine within 100 days to tackle any immunity evasion from Omicron.
Pfizer saw a boost to its share price at the end of trading on Friday whilst BioNTech is currently up 4.17 percent.
With stocks falling there has been a scramble for safe haven assets such as gold.
The fall in the FTSE wipes out an initial recovery of around one percent which was seen yesterday.
On Friday last week global markets plummeted on news of the spread of the Omicron variant and announcements of new travel bans.
Commenting on the market turbulence AJ Bell Investment Director Russ Mould said: “Markets hate uncertainty, and this is precisely what we have now.
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“No one knows how much trouble the new variant is going to cause, and so it seems plausible that we will see heightened volatility on the markets until there is adequate data to better understand the lay of the land.
“However, in the bigger scheme of things today’s sell-off could have been a lot worse.
“European markets were down one percent or less.
“That’s become a normal day’s movement on many occasions over the past year or so.”
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