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Our briefing for Tuesday, September 7, 2021:
Sep 7, 2021 3:24:51 PM
- In the United States, boosters are still set to become available by Sept. 20, but Pfizer jabs will likely be available before Moderna. According to Dr. Anthony Fauci, U.S. top infectious disease expert, Pfizer has submitted all the necessary information to the U.S. Food and Drug Administration (FDA), but Moderna is still a little bit behind in the process. Fauci says he hopes both vaccines will be available for the booster rollout in late September, but if Moderna fails to complete the process in time then the Moderna doses will be given later.
- In Canada, new rules for international travellers have officially come into effect. As the Government of Canada’s border reopening plan enters its latest phase, fully vaccinated international travellers no longer need to quarantine for 14 days upon arrival. Travellers must show proof of full vaccination received at least 14 days prior to entry, or a negative Covid-19 test taken no more than 72 hours prior to their scheduled flight or border crossing. Travellers must also be asymptomatic and must upload all their documentation through the ArriveCAN app or website within 72 hours before their arrival.
- In the United Kingdom, vaccine passports will be needed for entry to nightclubs and similarly crowded indoor venues, the vaccines minister has confirmed. On Sunday Nadhim Zahawi told British media that nightclub visitors will have to prove their vaccination status via the passport, by the end of this month. Zahawi says the passports are the best way to keep the economy open, and that the government is working closely with the industry to help ensure the venues can be opened safely. The vaccine passport rules will only apply in England.
- Japan’s Prime Minister Yoshihide Suga will not run in the governing party’s leadership elections this month, creating space for a new leader to become the country’s prime minister. Suga has been widely criticized for his handling of the coronavirus pandemic and for pushing ahead with the Tokyo Olympics despite objections from health experts. Suga said his decision to step down was based on the desire to focus more on the pandemic. "As I was planning to run for the presidency, when I thought about the coronavirus measures and also campaigning, I realized a great deal of energy would be needed, that I cannot have it both ways and that I must choose one or the other," he said.
- In New Zealand, Covid-19 lockdown measures will be eased across the country with the exception of Auckland. Auckland has remained the epicentre of the outbreak, and so the city will stay in a full lockdown until at least Sept. 14. Prime Minister Jacinda Ardern says her government will continue to pursue an elimination strategy. "We are within sight of elimination, but we can't drop the ball," Ardern said at a news conference. "Day by day we are making very good progress. What I don’t want to do is move too quickly and then see a resurgence."
- In Australia, New South Wales (NSW) Premier Gladys Berejiklian says hospitals will be under the most pressure in the coming weeks. Berejiklian says the government’s modelling shows daily cases in Sydney’s worst-affected suburbs are expected to rise to as high as 2000 until the middle of the month. "If too many of us do the wrong thing, (if) there are too many super-spreading events, we could see those numbers higher," Berejiklian said during a media briefing. NSW reported a total of 1281 new cases on Monday, down from 1485 a day earlier.
Covid-19 – Due Diligence And Asset Management
Active funds ride the post-vaccine wave while appetite for index funds slow, says Calastone
Brief: A strong month for equity funds saw inflows rise to GBP1.3 billion in August, according to the latest Fund Flow Index (FFI) from global finds network Calastone. Since the sea change in sentiment towards equity funds that accompanied the announcement of successful clinical trials of Pfizer’s, Moderna’s and AstraZeneca’s Covid-19 vaccines in November 2020, investors have added GBP17.2 billion to their equity holdings. This means more than a third of the net inflows to equity funds (35 per cent) since 2015 has taken place in the last ten months alone. Global funds saw the largest net inflows in August (GBP1.1 billion), much of this targeted at ESG offerings. Most other categories saw only modest inflows, though funds focused on UK equities, equity income and Asia-Pacific all suffered outflows.
Postponing a Return to Office Gets Companies Nowhere
Brief: The planned autumn 2021 return to the office is being delayed. Until January, purportedly. That’s when Apple Inc., Amazon.com Inc., Facebook Inc., Alphabet Inc. subsidiary Google, Microsoft Corp. and some other major employers of knowledge workers now say they expect people back at their desks, 22 months after sending everybody home at the outset of the Covid-19 pandemic. Given the current high U.S. levels of Covid cases, hospitalizations and in some places deaths, it’s understandable that companies don’t want to do a big return-to-office right now. Less clear is why they all thought early fall would be such a great time for RTO in the first place, or why they think the coast will be so much clearer in January.
Wall Street falls on worries over slowing economic recovery
Brief: The Dow Jones and S&P 500 fell on Tuesday, as worries over the slowing pace of economic recovery overshadowed hopes that the Federal Reserve would maintain its accommodative stance a little longer after a soft U.S. payrolls report. Amgen Inc and Merck & Co dropped about 2.5% each as the drugmakers dragged down the Dow Jones index, after Morgan Stanley cut its rating on the stocks to "equal-weight" from "overweight". Industrial heavyweight Boeing Co also slipped 1.9% after Ireland's Ryanair said it had ended talks with the planemaker over a purchase of 737 MAX 10 jets worth tens of billions of dollars due to differences over price. Ten out of eleven sub-indexes fell in early trading with economy-sensitive sectors like industrials, real estate and materials leading declines.
UK M&A deals continue to rebound after pandemic
Brief: The total value of mergers and acquisition (M&A) activity taking place across the UK has gone up significantly in the second quarter of 2021 compared to the first, as lockdown restrictions eased, government data has revealed.According to the Office for National Statistics (ONS), the total value of inward M&A — foreign companies abroad acquiring UK companies — was £27.7bn ($38bn) in Q2, £19.4bn more than the previous quarter. The value of domestic M&A — UK companies acquiring other UK companies — was £10.6bn in Q2, an increase of £6.1bn.Two notable domestic acquisitions were National Grid's (NG.L) £8bn acquisition of British firm Western Power Distribution; and water giant Pennon Group (PNN.L) buying the company behind Bristol Water from its US, European and Japanese owners for £425m.
Post-Pandemic Economic Puzzle Widens to ‘Phantom Menace’ Rate
Brief: Global central bankers trying to gauge the threat posed by surging inflation have another puzzle to solve too: whether the pandemic has shifted their policy bearings. The disruption caused by Covid-19 has been so extensive that economists including Kristin Forbes at the Massachusetts Institute of Technology are now wondering if one repercussion could be an increase in advanced economies’ neutral level of interest rate -- the setting at which growth is neither stimulated nor constricted. If that equilibrium point -- sometimes called R* -- has drifted higher, that would mean central banks’ already ultra-easy monetary policy is looser than generally thought.While that offers the prospect that officials may need to repeatedly raise interest rates in due course to brake the economy, it also holds the risk that they misjudge how stimulative their stance is. Such a policy error could open the door to an enduring bout of inflation.
