FTSE 100 extends gains on Pfizer’s Covid-19 vaccine hopes

• FTSE 100 up 6% over last two sessions this week on Covid-19 vaccine hopes
• Pfizer coronavirus vaccine 90% effective
• Blue-chip index rally could peter out if vaccine trials are unable to clear all hurdles

The FTSE 100 extended its gains on Tuesday, with investors hopeful of a potential breakthrough in the search for a vaccine against Covid-19.

The blue-chip index built on its strong performance last week, with the index buoyed by Joe Biden winning the US presidential election, bringing an end to Donald Trump’s controversial time in the White House.

The FTSE 100 is up more than 11% over the last seven trading sessions, closing at 6296 points on Tuesday, with the index down 17% year-to-date.

Pfizer’s Covid-19 vaccine 90% effective

The US-based drug maker, Pfizer, saw its share price soar 15% on Monday after it announced that its coronavirus vaccine was 90% effective, according to its preliminary analysis.

The new drug, which has been developed by Pfizer and BioNTech, has been tested on 43,500 people across six countries with no safety concerns raise, with the two companies seeking emergency approval to start using the vaccine by the end of November.

It is worth noting that the vaccine still has a number of hurdles that it must clear before it can be rolled out, but overall the announcement has been met warmly by scientists worldwide, with some believing life could return to normal as early as spring.

‘Today is a great day for science and humanity,’ Pfizer Chairman and CEO Dr Albert Bourla said. ‘The first set of results from our Phase 3 Covid-19 vaccine trial provides the initial evidence of our vaccine’s ability to prevent COVID-19.’

‘We are reaching this critical milestone in our vaccine development program at a time when the world needs it most with infection rates setting new records, hospitals nearing over-capacity and economies struggling to reopen,’ he added.

‘With today’s news, we are a significant step closer to providing people around the world with a much-needed breakthrough to help bring an end to this global health crisis.’

Pfizer is trading at $38.80 per share at the time of publication, with the stock down 0.84% year-to-date.

FTSE 100: technical analysis

The FTSE 100 saw massive gains yesterday as traders jumped into value stocks over the big tech names, according to Josh Mahony, senior market analyst at IG.

‘That rise looks like it could continue, with the index attempting to push higher from here. A break through the 6462 peak from yesterday would provide a fresh near-term bullish signal for the index,’ he said.

‘Conversely, a decline below the 6103 level would bring about questions over the potential for a retracement phase coming into play,’ Mahony added.

‘However, whether that pullback comes into play or not, the break through 6038 does appear to have marked an end to the downtrend that has been in place since the June peak.’

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