The new day in the financial markets begins with the same worry that has consumed them since Thursday: Omicron and the dangers this new coronavirus variant poses to the global economy.
Earlier today Stephane Bancel, the CEO of Moderna, stated that the company’s mRNA vaccine will most likely offer lower protection to the new variant than it did for Delta (a strain of Covid-19 that was already proving it could infect some of the vaccinated population).
According to Bancel, Moderna will have more reliable data on the actual efficacy of its vaccine against the Omicron variant in the next two weeks. The current recommendation of all relevant health agencies around the world is to keep getting vaccinated or receiving booster doses, even if the current vaccines offer lower protection against the most highly mutated version of Covid-19 we have seen so far.
Moderna, like Pfizer-BioNTech, stated that it aims to produce a vaccine that is effective against newer variants in the next four months. Still, that leaves the world to the mercy of the pandemic possibly until the end of the winter.
In addition to the vaccines, the antiviral drug Regeneron, which is currently undergoing clinical trials and offers hope of one more medicament that can treat patients already infected with Covid-19, also seems to be less effective against Omicron, based on statements by the company making it.
One possible source of relief is that preliminary research from South Africa, where Omicron was first identified, shows that while this strain is highly contagious, it tends to cause less severe coronavirus symptoms.
Still, the overall mood among investors is one of risk aversion, with lots of interest pouring towards safe haven assets like the Japanese yen.
Unsurprisingly, US stock indices will trade lower, as did European ones earlier in the morning.
In other news, the eurozone today marked its highest-ever inflation of 4.9% YoY in November (all other inflation indicators were also higher than the forecasts). This might seem like a cause for pressure on the ECB to consider monetary policy tightening, but the bank has insisted that the spike is transitory and expects it to decline in December.
