News & Analysis
News & Analysis

Weekly Summary – Vaccine Updates and Rising Covid-19 Cases

19 November 2020 By Deepta Bolaky


Investors welcomed the series of positive vaccine updates across the week against the backdrop of the rapid global surge in the number of coronavirus cases. The sentiment in the financial markets swayed between risk-on and risk-off reflecting the uncertainty of global economic growth following more localised lockdowns and social distancing measures in major economies.

Stock Market – Vaccine Updates

Global equities started the week on a strong note following the recent vaccine updates but the momentum tamed amid the elevated concerns of rising virus cases as the week comes to an end. The US share market was also underpinned by the stimulus gridlock in Washington.

Moderna announced that the Phase 3 study met the statistical criteria with a vaccine efficacy of 94.5%.

Pfizer and BioNtech provided another update this week whereby they announced more promising results on the efficacy rate. After conducting the final efficacy analysis in their ongoing Phase 3 study, their mRNA-based COVID-19 vaccine candidate met all the study’s primary efficacy endpoints. The analysis of the data indicates a vaccine efficacy rate of 95%.


Source: Bloomberg

Forex Market

In the forex market, the price action was also primarily driven by the vaccine and virus updates. Major currencies remained mostly within familiar levels. Safe-haven currencies like the Japanese Yen and Swiss franc together with the British Pound were among the best performers against the US dollar while commodity-related currencies were trading mostly on the downside. 

Source: Bloomberg

US Dollar Drop

The US dollar struggled against its peers this week following fresh daily records on the virus front, mixed economic data, a dovish central bank and a stimulus gridlock. The greenback was unable to follow other safe-haven currencies amid the current environment. 

On the economic front, investors digested the mixed data and the prospects of more economic grief in the coming months following more lockdowns and social distancing measures to combat the virus outbreak in the US. 

  • Retail Sales were up by 0.3% from September 2020 and came below the expectations of 0.5% and lower than the previous month of 1.6%. Retail Sales is a leading indicator which provides a glimpse into the upcoming quarterly GDP number and helps to gauge consumer spending and the impact of COVID-19 and more nationals and localised lockdowns on businesses and consumers.
  • Building Permits: Privately-owned housing units authorized by building permits in October were unchanged at a seasonally adjusted annual rate of 1,545,000 but above the October 2019 rate of 1,503,000.
  • Housing Starts: Privately-owned housing starts in October were at a seasonally adjusted annual rate of 1,530,000. This is 4.9 percent above the revised September estimate of 1,459,000 and is 14.2 percent above the October 2019 rate of 1,340,000.
  • Home Sales: In a low-interest-rate environment, the sales of previously owned homes rose to a 6.85 million annualised rate. 

  • Jobless Claims: The labour market is providing insights of more pain ahead given the lockdowns. In the week ending November 14, the initial claims were 742,000, an increase of 31,000 from the previous week’s revised level of 711,000.

  • Philadelphia Fed Manufacturing Survey: The current activity decreased 6 points to 26.3 in November but came above the expectations of 22. It is the 6th consecutive positive reading after reaching long-term lows in April and May.
Aussie Dollar – Employment Reports

The Aussie dollar was the worst-performing G10 currencies despite the upbeat employment reports. The 6-day lockdown in South Australia might have underpinned the recent rise of the local currency. The Australian economy recorded a strong rise in employment and hours worked in October:

  • The Unemployment rate increased to 7.0%.
  • The Participation rate increased to 65.8%.
  • Employment increased to 12,773,900.
  • Employment to population ratio increased to 61.2%.
  • The Underemployment rate decreased to 10.4%.
  • Monthly hours worked increased by 21 million hours.

After the ups and downs, the AUDUSD pair was currently unchanged around 0.7275 for the week as of writing. Retail Sales figures may be the next catalyst for the AUD traders. 

Source: GO MT4

British Pound – Brexit

Amid a relatively subdued economic calendar at the start of the week, the British Pound was mostly driven by the Brexit updates. The headlines around the negotiations were more promising towards the end of the week which boosted the Pound. However, news that an EU negotiator has contracted the virus may delay the negotiations which were at a crucial stage. 

On the economic front, the Consumer Prices Index (CPI) 12-month rate was 0.7% in October 2020, up from 0.5% in September. The next event will be the Retail Sales figures. As of writing, the GBPUSD pair was up for the week and trading around the 1.32 level. 

Source: GO MT4

Oil Market

Crude oil prices remained above the 40 mark buoyed by vaccine updates and mixed weekly data:

  • EIA reported an inventory level below forecasts. The build in inventory was more modest at 0.768M barrels compared to the 1.65M barrels expected. 
  • API reported a much larger-than-expected inventory level of 4.174M.

As of writing, WTI Crude oil (Nymex) and Brent Crude (ICE) were trading at around $41.58 and $44.20 respectively.


The precious metal remained depressed by the recent positive vaccine news and the gridlock in Washington despite the concerns on the virus front.  As of writing, the XAUUSD pair is trading around $1,862.

Source: GO MT4

Key Upcoming Events

  • G20 Meeting and Consumer Confidence (Eurozone)
  • Retail Sales (Australia)
  • GfK Consumer Price Confidence, and Retail Sales (UK)
  • PBoC Interest Rate Decision (China)
  • Producer Price Index and German Buba President Weidmann Speech (Germany)
  • Retail Sales (Canada)
Monday, 23 November 2020 
Indicative Index Dividends
Dividends are in Points
ASX200 WS30 US500 US2000 NDX100 CAC40 STOXX50
0.58 6.645 0.405 0.035 0 0 0
ESP35 ITA40 FTSE100 DAX30 HK50 JP225 INDIA50
0.328 18.598 0 0 0 0 0

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