Hope and doubt are close together these days and currently the doubts predominate. The doubts as to whether the world will really be recovered from the corona shock so quickly – but the mood can quickly change again at any time. This is exactly what stock market prices currently look like: They have been painting a sawtooth pattern on the price boards of the world stock exchanges since the beginning of April. This week was slightly down again, mainly due to the bad news from the health sector. After all, the pharmaceutical and biotech industry had recently fueled hope that there could soon be a vaccine against the COVID virus. That had given the courses a boost recently. Now the confidence has been dashed, at least that the US company Moderna can already report good news. That is why the stock markets went down again in the middle of the week. But then came the next good news.
Hamburg University Hospital Eppendorf is currently looking for volunteers for a vaccine study, it said on Wednesday. So there are already advances in this country that are paying attention. The US pharmaceutical company Moderna, which has already started its first vaccine study, has recently been a great source of hope. Overall, the company’s share has therefore increased by a remarkable 300 percent since February. But since the beginning of the week, it has now lost ten percent again, after the first interim results of the study were not as positive and were not as comprehensive as observers had expected. This initially depressed investor sentiment, particularly on the Asian stock exchanges, and then continued on Tuesday in the United States. The stock market indices worldwide fell slightly after last week’s gains. The European stock exchange regulator ESMA also put the brakes on by warning in its risk report that the market would remain very unpredictable in the foreseeable future because the economic consequences of the corona pandemic are still difficult to assess.
The decisive criterion for the recovery of the global economy is currently: How soon will a vaccine against the pandemic be found? So far, some experts assume that extensive tests can be carried out in early summer. And a preparation could possibly come onto the market as early as autumn. However, it is rather the optimists among the industry observers, you have to say. If it were really possible to find a vaccine serum before winter, then it would be like a global super coup. So far, it took several years to develop such substances and to get them approved.
Beyond the question of how long it will take the world before medicines and vaccines are available, there is of course something else that is exciting: Which companies will be the leading developers? So who will be the first to bring an antidote to the market and thereby make a huge profit out of the crisis? Because one thing is clear – anyone who finds a remedy for COVID has something like a license to print money. Because all states will try to get large quantities of these drugs and vaccine doses and thus protect their population from a possible new pandemic wave.
Race at full speed
Who is currently in the lead in the race for vaccine development – and what does that mean for investors? The fact that the search for antidotes is now in full swing reinforces a trend that the pharmaceutical industry is experiencing quite regularly anyway: it does not apply the old stock exchange wisdom that investors can confidently sell their shares in May to sit out the summer doldrums – only to enter the market again in autumn. Almost every year it goes like this in the pharmaceutical industry: From May the prices rise and quite reliably until August, as the local indices of the listed pharmaceutical and biotech companies show.
Why it is like that? Because in April and May it can get very cold in many countries in the northern hemisphere, which increases the sales of flu drugs and because the hay fever period starts, market watchers justify it. Both increase the turnover of the companies and pull the stock prices up. There will be a special boom this year: Because many consumers worldwide have stocked themselves with medication in view of the lockdowns – in some places there have been hamster purchases of certain painkillers and flu medication – which is why manufacturers, pharmacies and hospitals will have to replenish their stocks soon. This will give production an extra boost and will increase sales and profits for pharmaceutical companies in the coming weeks.
And now there is the search for the super vaccine – which no one knows yet how it will turn out and who will win the race. Therefore, it would be a good time right now to put a few shares in the healthcare sector in deposit. Even at short notice. Because with a bit of luck, there will be a few real winners in the fall, who will have polished up the balance sheet of their own portfolio and made it a little easier to get over the last losses suffered – if they still exist.
There are currently more than enough candidates to choose from. Over 100 research projects are already underway worldwide. If you only list the names of the listed companies that are currently heavily involved in the fight for the active ingredient in COVID, then in addition to Moderna and Gilead from the United States also include German Biontech, Cansino from China, Avigan from Japan, Astra Seneca from Great Britain, Novavax and Biocryst from America and many others. Gilead, in particular, had already sparked a lot of hope with the Remdesivor. That has pushed the U.S. manufacturer’s share price from $ 63 to $ 84 since late February. From a three-month perspective, however, Gilead also posted a rather misleading zigzag price on the stock market. After all, it is a big winner from a ten-year perspective: only 290 in the industry can boast a 290 percent course plus. Over the five-year period, however, Gilead lost around 33 percent. The coming months will therefore be decisive for the share.