The market got euphoric as soon as there was news of an effective vaccine for COVID-19. However, problems with increasing restrictions seem to be gaining in importance nowadays. Investors may also follow the meeting of EU leaders to resolve the deadlock in the EU budget and approve the recovery fund.
The main stock exchange indices in Europe seem to be falling on Thursday as concerns about the growing number of coronavirus infections are rising. This in turn may lead to fears of more restrictions, which in turn seems to overshadow the positive news about COVID-19 vaccines.
Oxford and AstraZeneca have announced that vaccine trials have given a strong immune response among all adults. Pfizer, on the other hand, announced that its vaccine is ultimately 95 percent effective with 94.5 percent of Moderna's vaccine.
Schools and restaurants in the U.S. closed again
Information coming from across the ocean does not inspire optimism. On Wednesday, New York decided to close down schools and return to home schooling, and Minnesota ordered to close all restaurants, bars and entertainment venues for four weeks. As a result, speculation was also expected to appear on the market that the Federal Reserve could react by further loosening monetary policy precisely because of the increased restrictions resulting from the spreading epidemic and the continued absence of an aid package for the American economy.
Announcement of possible ECB actions
The European Central Bank may also prepare for further actions. During the hearing in the European Parliament on Thursday, ECB President Christine Lagarde spoke about the central bank's swift and decisive response to the first wave of the pandemic that hit the eurozone economies.
With the same approach and determination we will address the current phase of the crisis, added Christine Lagarde. This could therefore be an announcement of the ECB's actions already at the meeting that will take place on 10 December. Lagarde announced that the main tools will remain the extraordinary purchasing programme during the pandemic (PEPP) and targeted long-term refinancing operations (TLTRO).
Daniel Kostecki, Chief Analyst Conotoxia Ltd.
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