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Our briefing for Wednesday, October 6, 2021:
Oct 6, 2021 3:39:35 PM
- In the United States, Johnson & Johnson is seeking approval from the Food and Drug Administration (FDA) for emergency use authorization of a booster shot. They are looking to have boosters authorized for anyone 18 and older who previously had their single-dose vaccine. The FDA has already authorized booster doses of the Pfizer vaccine for people 65 and older, those at high risk of health complications and those whose jobs expose them to the virus. Moderna also submitted an application to the FDA last month seeking authorization of a booster shot, and a panel will meet next week to make a decision.
- In Canada, the provinces of Alberta and B.C. are expanding their eligibility for booster shots as they battle the latest wave of infections. Now anyone in Alberta 75 and older, and First Nations, Inuit and Metis people who are 65 and older, can book a third dose of vaccine, as long as it has been six months since their last shot. “We’re doing this because older Albertans remain uniquely at risk and will benefit from more protection," said Premier Jason Kenney. Neighbouring B.C. announced it will expand the group of immunocompromised people who are currently eligible for a vaccine, meaning that about an additional 100,000 people will receive an invitation for a third dose.
- In the United Kingdom, plans to vaccinate children ages 12-15 in England are being delayed because of high infection rates in schools. Officials had determined that the mid-term in autumn would be an ideal target to have vaccinations completed, after receiving complaints that England is falling behind other countries. But the program has yet to rollout in many areas and others have said they had challenges meeting the high demand. High infection rates are also causing further delays, as students who test positive for the virus have to wait a period of 28 days before they can receive their vaccination. According to numbers from the Department for Education, about 204,000 students in England were absent due to Covid-19 last week.
- In the United Arab Emirates (UAE), Abu Dhabi’s crown prince has announced that life is going back to normal after the coronavirus pandemic. Sheikh Mohammed bin Zayed made the announcement on Wednesday as virus cases in the Emirates fell. “I bring you good news. The health situation in the United Arab Emirates is good,” he said. New cases in Emirates have fallen below 200 per day, the lowest they’ve been in over a year. “We thank God that we have emerged from this crisis, well, with goodness, honor, safety, health and experiences that we have paid for but that have brought us a lot of knowledge,” Sheikh Mohammed said.
- Spain approved administering third doses of the Pfizer and Moderna vaccines for people ages 70 and over. The booster campaign will begin at the end of October and will aim to keep vulnerable people safer, the health ministry said. Until now Spain has only offered third doses to home care residents and some people who are immunocompromised. The European Medicines Agency has approved booster doses of both the Pfizer and Moderna vaccines for people who are seriously immunocompromised. About 78% of Spain’s population is fully vaccinated as of Tuesday.
- Western Australia announced a vaccine mandate for all employees who work with natural resources. People who work in oil and gas exploration or mining will need to have their first dose of vaccine by December 1, and be fully vaccinated by January 1. The mandate will apply to around 141,000 workers in the natural resource sector and is intended to protect vulnerable indigenous communities. Western Australia has only seen a total of 1109 cases and nine deaths since the beginning of the pandemic. It has vaccinated about 54% of its population, compared with 46% nationally.
Covid-19 – Due Diligence And Asset Management
Private equity GPs to increase exposure to energy sector over next five years
Brief: An overwhelming majority (93 per cent) of private equity fund managers expect to make an investment in the energy sector over the coming five years as they seek to capitalise on the post-pandemic rebound in global demand for power and government-backed stimulus programmes. Of these, over half (51 per cent), stated they were ‘extremely likely’ to invest in energy. The findings are revealed in a new study, Recovery to Rediscovery: Capitalising on a Changed Private Equity Landscape, which was commissioned by Auxadi, a leading provider of accounting, tax and payroll services to private equity, real estate, and multinationals. It was based on interviews with senior-level private equity investors with average assets under management of EUR14.4 billion.
Bridgewater’s Jensen Says Stagflation is ‘Real Risk’ to Assets
Brief: While inflation concerns mount for the U.S. economy, the real danger may be the combination of rising prices and a stagnating economy, said Bridgewater Associates co-Chief Investment Officer Greg Jensen. “The problem is stagflation -- that’s the real risk, and so many portfolios are massively exposed,” Jensen said Wednesday at the Bloomberg Invest virtual conference. Policymakers have limited options to handle that, Jensen said in an interview with Stephanie Flanders of Bloomberg Economics. “The Fed faces certainly the problem of inflation being well above their target and the inability to be as easy as they’d like to be and being pulled along by that -- and certainly the increasing odds that we’re facing bubbles,” he said.
European Firms Mull Moving Staff From Hong Kong, Chamber Says
Brief: European companies are discussing relocating staff from Hong Kong, the region’s local chamber of commerce said, as the city commits to a “Covid Zero” strategy that almost every country apart from China is abandoning. Hong Kong’s strict quarantine measures have led many businesses to consider restructuring at least part of their operations to places such as Singapore, Frederik Gollob, chairman of the European Chamber of Commerce in Hong Kong, said Wednesday on Bloomberg Television.“You can assume that in most boardrooms across Europe and Hong Kong this is a subject of discussion,” he said. “You can’t really avoid it, looking at the restrictions. “His comments come a day after Chief Executive Carrie Lam said Hong Kong’s ties with mainland China were more important than the international business and global travel connections that helped cement the city’s status as an Asian financial center.
The Stock Market Hasn't Been This Frenetic Since Early in the Pandemic
Brief: Pick a direction, and don’t go with it. That’s the story in stocks of late, with the S&P 500 alternating between gains and losses of at least 1% for four straight sessions -- the longest stretch since June 2020. It’s the same in fixed income, with 10-year Treasury yields swinging wildly around 1.5%. The harrowing reversals reflect a particularly stark divide between bull and bear cases in markets right now. On one side, risk appetites are being constricted by lingering uncertainty over the government debt ceiling, tightening Federal Reserve policy and disrupted supply chains. At the same time, sentiment is being buttressed by improving Covid trends, an economy that keeps chugging along and forecasts for more double-digit earnings growth from corporate America.
RBC cuts Air Canada rating amid 'lower for longer' recovery
Brief: RBC Capital Markets downgraded its rating on Air Canada to the equivalent of hold from buy, citing a “heightened risk” that COVID-19 variants will cap the stock’s near-term performance.“The [Delta] variant has undoubtedly impacted the pace of the recovery while also adding a layer of uncertainty regarding the timing of the industry’s ‘return to normal,’” Walter Spracklin and Ryall Stroud, analysts at RBC, wrote, arguing investors should prepare for a more stubborn recovery that stays “lower for longer.” Tuesday’s downgrade represents the first time the bank’s analysts have lowered Air Canada’s stock rating since 2013. Their outperform rating remained untouched through the thick of the pandemic, as the airline slashed capacity and global travel collapsed. But new data indicates the recovery will be “choppier” and longer than previously assumed, Spracklin and Stroud wrote.
