.png?width=200&height=78&name=CH%20Diligence%20(thicker%20line).png "CH Diligence (thicker line).png")
Our briefing for Friday, January 21, 2022:
Jan 21, 2022 3:55:53 PM
- In the United States, the state of California may become the first to allow children ages 12 and up to be vaccinated without their parents’ consent. Senator Scott Wiener, a Democrat from San Francisco, proposed the change on Thursday, which would make California the state with the youngest age for such decisions. In Alabama the age is 14, in Oregon it’s 15 and 16 in Rhode Island and South Carolina. “This is about empowering teenagers to make decisions on their own health and their own safety,” Wiener said. “Almost a million California teenagers are unvaccinated, and for a lot of those teens it’s because their parents either refuse to get them vaccinated or they have not yet gotten around to it.”
- In Canada, the premier of Alberta is calling on Prime Minister Justin Trudeau to extend an exemption to a Covid-19 vaccine mandate for truckers, citing supply chain issues and inflation. The mandate means truck drivers entering from the U.S. must be fully vaccinated if they want to avoid a Covid-19 test and two-week quarantine when crossing into Canada. It has been in place since January. 15, while the U.S. confirmed their plans to put a similar mandate in place this Saturday. Industry representatives say the mandate has cost them about 10% of their international drivers. Justin Trudeau defended the mandate on Wednesday, saying it’s in alignment with the U.S.
- In the United Kingdom, only two coronavirus briefings at the height of the pandemic were led by a female politician, a new report on gender representation has found. The 2022 Sex and Power Index was compiled by the Fawcett Society, a non-profit that advocates for women’s rights. According to the index, 43% of the 56 daily press conferences on coronavirus featured all men with no female politicians or experts present. Only 92 of the 274 members of Covid-19 advisory boards are women, the index shows. “The pandemic has laid bare deep-rooted inequalities across the UK,” said Jemima Olchawski, CEO of the Fawcett Society.
- France set out a plan to ease coronavirus restrictions in February, although vaccine passports and indoor mask wearing will remain in place. Prime Minister Jean Castex made the announcement on Thursday, saying that there are “encouraging signs” that the current wave of Omicron is slowing. The vaccine passport system will come into effect on Monday, meaning people will no longer be able to show a negative test to enter bars, restaurants, theatres or to travel on trains. Beginning on February 2, masks will no longer be required outdoors and working from home will no longer be mandatory. By February 16, people will be allowed to eat and drink in stadiums, and nightclubs will be allowed to reopen.
- Austria’s parliament voted on Thursday to introduce the European Union’s strictest vaccine mandate, the first of its kind. The new legislation passed with 137 votes in favour and 33 against, with all parties except the far right supporting the measure. The new law goes into effect on February 1, however officials will only begin conducting checks from March 15. Beginning then, those without a Covid-19 vaccine or exemption will be facing fines of 600 euros ($680). Pregnant women and those who can’t be vaccinated for medical reasons will be exempt from the mandate. Currently about 72% of Austrians are fully vaccinated, which is in line with the European Union average.
- New Zealand says it will not be using lockdowns in the future even as Omicron hits, which Prime Minister Jacinda Ardern says is inevitable. New Zealand has so far avoided having any large outbreaks of the Omicron variant, it’s one of the few countries in the world to do so. "This stage of the pandemic is different to what we have dealt with before. Omicron is more transmissible," Ardern said. "That is going to make it harder to keep it out, but it will also make it more challenging to control once it arrives.” Ardern said within 24 to 48 hours of Omicron being detected in the community, the nation would move into its “red” stage which means children would have to wear masks in school and crowds would be limited to 100 people.
Covid-19 – Due Diligence And Asset Management
Biotech and healthcare investors hope for rebound following weak 2021
Brief: 2021 was a difficult year for biotech equities, with the Nasdaq Biotechnology Index giving a full year performance of -0.6% and a total return of 0%, underperforming the S&P 500 benchmark by more than 25 percentage points. It was one of the worst years for the index. As of 20 January, the Nasdaq Health Care Index was down 23.9% compared to 12 months prior. The industry experienced a lot of volatility throughout last year. Funds such as the L&G Healthcare Breakthrough UCITS ETF finished the year down 8.32%, while BB Biotech reported a net loss of CHF 405m (£327.3m). But biotech investors and analysts are looking to the new year with optimism. Investment in the sector, after all, is about long-term potential - and performance.Despite a boom in investment, catalysed by the pandemic, Covid-19 slowed growth for biotech and healthcare companies that are not Covid-focused, according to Howie Li, head of ETFs at Legal & General Investment Management.
Canadians continue to flock to foreign investments during pandemic
Brief: “No place like home” has become “anywhere but here” for Canadian investment portfolios. According to Statistics Canada, Canadians pumped $17.5 billion into foreign securities last November compared to $5.4 billion in October - drastically accelerating a trend that has seen investment dollars flow out of the country since the onset of the pandemic. The bulk of those Canadian dollars - $7.4 billion - went toward purchases of U.S. shares with a focus on big technology companies, and funds that track broad market indices such as the benchmark S&P 500. Canadian investors also purchased $4 billion in non-U.S. foreign shares in November. The massive flow of foreign investments were made by Canadian businesses, governments and big institutional investors, but also include individual retail investors either directly or through pensions, mutual funds or exchange-traded funds (ETFs). I
Netflix, Peloton bring the pandemic-stock era to shuddering halt
Brief: The COVID-19 pandemic isn’t over yet, but the boom it helped create for stay-at-home stocks is vanishing. Netflix Inc. and Peloton Interactive Inc., two of the highest-profile stars of the lockdown era, both plunged Thursday -- the latest sign that investors have moved on from the so-called pandemic trade. Netflix expects to add a paltry 2.5 million users in the current quarter, well short of estimates. Peloton, meanwhile, is slashing costs to cope with slowing demand for its stationary bikes. Netflix shares were down about 20 per cent in premarket on Friday, holding the drop seen in late trade on Thursday. If the loss sticks, it would be the stock’s biggest drop in almost a decade. Peloton shares were up five per cent in premarket after sinking 24 per cent on Thursday.
Trust discounts widen in 2021 as post-Covid euphoria is hit by new variants
Brief: In 2021, equity investment trusts saw their discounts widen by a weighted average of 4.8%, according to figures from the Association of Investment Companies (AIC) and Morningstar for Investment Week. However, when it comes to the individual winners and losers trusts swung drastically in both directions. Ten years ago, in 2011, the equity investment trust universe saw their discounts widen by a weighted average of 11.1%. Since then the widening has gradually been declining, reaching just 3% for 2020. However, 2021 saw the reversal of that trend, with the average widening ending up higher than that of 2019. "If we cast our minds back to this time last year there was a fair bit of euphoria around the ‘reopening' trade as Covid vaccines began to be rolled out," explained Sarah Godfrey, director of investment trusts at Edison Group.
Global hedge fund capital passes USD4tn mark
Brief: Total hedge fund industry capital has passed the USD4 trillion milestone to begin 2022, with managers navigating a volatile Q4 21 driven by another wave of coronavirus variant, as well as rising interest rates and increased expectations for additional increases in 2022. Total hedge fund capital rose increased to an estimated USD4.01 trillion to begin 2022, representing an increase of over USD400 billion from the start of 2021, as reported by HFR in the latest release of the HFR Global Hedge Fund Industry Report. As reported previously, total hedge fund industry capital has soared by over USD1 trillion in the trailing seven quarters since falling below USD3 trillion in Q1 20 as the global pandemic began. The HFRI Fund Weighted Composite Index (FWC) posted a gain of +0.5 per cent for 4Q21, bringing the FY 2021 performance to +10.3 per cent.
