Indeed, Moderna’s shares have fallen back since its bullish trial update, a sign that investors are already perhaps becoming more circumspect about such news – the reality gulf between trial results and mass vaccination starting to sink in. And it did not take long for questions to be asked about the accompanying rotation from growth to value, either. As Algy Hall points out in this week’s stock screen, a similar shift happened a year ago, on Brexit-related news, only to evaporate as quickly as it arrived. Vaccine news may be good, but it doesn’t necessarily change the cyclical and structural pressures that many companies and sectors were facing before the pandemic struck.
Certainly, with a return to recession looming in western economies because of more Covid restrictions and decreasing consumer and business confidence, the prospects for many companies are looking decidedly murky once again. Markets are, of course, forward looking, but looking past the pandemic with any certainty is surely beyond the grasp of even the most talented executives and analysts. And let us not forget that growth’s momentum is partly predicated on the idea that we are on the cusp of profound technological change that will shake up industries of old – pandemic hysteria may have led many to overstate the extent and pace of this change, but immeasurable disruption is almost certainly coming to an industry near you. Take banking and broking, for example, which may find the fintech upstarts like those we discuss in this week’s cover feature coming to eat their lunch. Or the possibility that Amazon comes along and eats them all.
Meanwhile, this week’s big government announcement of a green industrial revolution highlights the sustainability issues many industries still need to address, and – as the government accelerates its timetables for greening the UK – how little time they have in which to do it. Indeed, for every company that may see opportunity in building a greener future there will be others that face a painful and possibly terminal transition. And if the evidence of previous top-down government initiatives is anything to go by there is an even bigger risk to everyone – lots of disruption and very little economic pay off.
