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Dow dragged by Apple, lingering COVID vaccine and stimulus uncertainty

calendar 04/09/2020 - 16:00 UTC

On Thursday, the U.S. market was mainly dragged by Apple as it delays surprisingly one year its ad tracking software changes in its new OS Ios14 (beta) for privacy concern of users; the step may cut digital revenue. Apple said in a statement: We want to give developers the time they need to make the necessary changes, and as a result, the requirement to use this tracking permission will go into effect early next year.

Also, Facebook slips as it bans new political ads for the week before the U.S. election in Nov, which may again affect its revenue. Tesla plunged after investment house managed by Gifford cuts its stake 5% due to portfolio risk management and sizing after the surge in price. Gifford also vowed to enter Tesla again at any deep correction. The firm issued a statement:

The substantial increase in Tesla’s share price means that we needed to reduce our holding in order to reflect concentration guidelines that restrict the weight of a single stock in clients' portfolios. However, we intend to remain significant shareholders for many years ahead. We remain very optimistic about the future of the company. Tesla no longer faces any difficulty in raising capital at scale from outside sources but should there be serious setbacks in the share price we would welcome the opportunity to once again increase our shareholding.

On Thursday, Dow paid little attention to some positive COVID-19 vaccine headlines as Dr. Fauci virtually spoilt any probability of an early vaccine. Dow plunged more after Fauci said, although many people expect the vaccine by Nov-Dec and quite possible it may be also October, he personally thinks otherwise. Dar Fauci sounds quite contradictory and perplexing: I think most of the people feel it’s going to be November-December----it’s conceivable that you can have it by October, though I don’t think that that’s likely.

As a reminder, the U.S. CDC said on Wednesday asked all States to be prepared for a vaccine by 1st Nov. And over the past week, both Dr. Fauci and Dr. Hahn (U.S.FDA Head), have said that a vaccine may be available for certain groups before 3rd stage clinical trials have been completed if the data is overwhelmingly positive. The U.S. FDA will hold a meeting on 22nd Oct to consider the 3rd stage clinical data of 2-3 COVID-19 vaccines candidate and may approve them for emergency usage, just ahead of the Nov election.

In any way, on Thursday, Pfizer said it will finalize its COVID-19 vaccine 3rd stage trial in October. CEO Bourla said if the 3rd stage trial data obtained in the study proves to be optimistic, the company intends to apply for emergency authorization without hesitation. This is in line with the earlier statement made in August, claiming that it will, along with BioNTech SE, submit their COVID-19 vaccine candidate for regulatory review to the US FDA by October.

On Thursday, Johnson & Johnson (J&J) also announced that data published in the scientific journal Nature shows that Janssen investigational vaccine-elicited immune response to COVID-19 in a preclinical, nonhuman study in just one dose. The company intends to produce the vaccine in Janssen's facility in Leiden, the Netherlands. The company said: We are excited to see these preclinical data because they show our SARS-CoV-2 vaccine candidate generated a strong antibody response and provided protection with a single dose---the company intends to move to Phase 3 trial in September.

Elsewhere, Novavax announced positive early-stage data for its experimental COVID-19 vaccine was published in the New England Journal of Medicine.

On Thursday, Dow was also affected by a GT report that China may reduce its UST holdings by as-much-as 80% due to worsening U.S. economic outlook and lingering cold/real war tensions:

But on late Thursday, the Wall Street also got some boost and closed off the day low after a report that Mnuchin, Pelosi has reached an informal deal to avert the impending government shutdown at Aug end by agreeing to pursue a clean, short-term stopgap measure.

On early Friday, the U.S. VP Pence confirmed that the Trump admin and Congress have agreed to pass a bill to avoid a government shutdown without tying funding to separate measures such as coronavirus relief.



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