New vaccine announcement for Covid-19 with 90% efficacy: International markets soaring; Here's how NEPSE might react

An early look at data for a coronavirus vaccine shows it is more than 90% effective.

Pfizer Inc. is an American multinational pharmaceutical corporation. It is one of the world's largest pharmaceutical companies and ranked 57 on the 2018 Fortune 500 list of the largest United States corporations by total revenue. Pfizer said that the vaccine, made with German partner BioNTech, had an efficacy rate higher than 90% at seven days after the second dose. Thus, a person will be immune to the virus 28 days after vaccination.

This might be the greatest medical advance in the last century. On top of being a crucial advancement in the field of medicine, the news has come at a time when the world needed it. According to CNN, the Pfizer vaccine uses a never-before-approved technology called messenger RNA, or mRNA, to produce an immune response in people who are vaccinated.

In response to this news, the international markets surged yesterday. Markets soared in the U.S. as a potential vaccine promised a post-Covid life. According to investing.com, the Dow Jones Industrial Average rose 835 points, or 2.95%, while the S&P 500 was up 1.15% and the Nasdaq Composite fell 1.5%. Travel and leisure stocks rallied, with AMC Entertainment (NYSE: AMC) soaring 50%, Carnival (NYSE: CUK) Corporation up 39%, and Six Flags (NYSE: SIX) up 18%, as the vaccine promises to be a ticket to ride. Airlines also soared, with JetBlue Airways (NASDAQ: JBLU) Corp up 21% and Spirit Airlines (NYSE: SAVE) Inc rising 21%.

However, the news wasn't a great one for those businesses that had capitalized during the crisis. For example, stay-at-home stocks like Zoom, Amazon, and Netflix plunged on Monday morning after the vaccine announcement. According to Dailymail, Zoom dropped by 15 percent, Amazon went down by 3.4 percent and Netflix dropped by more than 5 percent in pre-market trading after the announcement.

This clearly signals that the economic scenario of the world will return to normal if the vaccine does what the data shows. The stock market gain during the pandemic wasn't because of economic prosperity. Rather, the economies of the world had tumbled and only a handful of selective companies had profited from the altered scenario. Thus, now that the pandemic seems to be nearing its end, the world economy can finally resume and businesses might properly operate locally and internationally.

NEPSE had also gained amidst the pandemic, thanks to increased volatility in the frozen banking system and resistance on other investment vehicles. Now that Nepal's national economy might revive, thankfully by the influx of tourists and resumption of international trade and local businesses, this vaccine announcement can be taken in a positive way. Furthermore, since the economy and the stock market go hand-in-hand, it wouldn't be irrational to hope for a fundamentally-sound advance in NEPSE too.