The Launch of a New Vaccine Has Caused the Growth of the US Indices

Some optimism is observed in the markets due to the new coronavirus vaccine. This week, Moderna has become the second pharmaceutical company in the United States to report positive trials for a COVID-19 vaccine which is considered to be essential to stop the pandemic. The stock indices have reacted positively to the news, while the foreign exchange market responded to these reports calmly as the US struggles to contain the second wave of infections. Now there can be a lot of speculation around the vaccine news, so we recommend trading more accurately and fixing the positions at the nearest levels.

The British pound and euro are strengthening amid news that the UK and the European Union may progress in negotiations on a post-Brexit trade deal. This came after it became known that Dominic Cummings, the most influential adviser to Prime Minister Boris Johnson, would leave his post in Downing Street in mid-December.

Citigroup Inc. analysts say the dollar is likely to fall by 20% in 2021 if Covid-19 vaccines become widespread and help revitalize global trade and economic growth. Analysts have been arguing for months that the US election, vaccine breakthroughs and Fed policies could hit the currency. Ultimately, the election did not act as a catalyst for a serious fall. Still, Citigroup says the broader macroeconomic background will be a more significant driver of the dollar in the future. The bank expects that vaccinations will ease tensions concerning the pandemic and that global economies will be on the rise again, as a result of which capital may be redistributed to the assets of others.

Oil prices are increasing on expectations that OPEC+ will extend the agreement to cut production by at least three months. The news of another promising coronavirus vaccine is also supporting the market. At the moment, the price for WTI oil is $41.19.

Market indicators

U.S. stocks rose on Monday, with the S&P 500 and Dow Jones Industrial Average hitting record highs after Moderna Inc reported on the effectiveness of its experimental COVID-19 vaccine. The Dow Jones closed with growth by 1.6% to 29.950.44 points, the S&P 500 – by 1.16% to 3.626.91 points. The Nasdaq increased by 0.8% to 11.924.129 points.

The dollar index fell to 92.46 amid news about the new vaccine.

The US 10-year government bond yield has grown to 0.91%.

It is worth paying attention to the news feed today. At this time, we recommend limiting your risks in positions.

• - US retail sales at 15:30 (GMT+2)
• - Speech by Bank of England Governor at 16:00 (GMT+2)
• - Speech by ECB President Lagarde at 18:00 (GMT+2)

by JMarkets, 2020.11.17

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.