Nasdaq Plunged on Vaccine Discovery, these Stocks are Laggards
The tech-heavy Nasdaq index fell more than 1.5% after Pfizer announced that its coronavirus vaccine is more than 90% effective in preventing infection in participants.
Although the news of vaccine discovery supported the Dow Jones Industrial Average, shares of companies that are benefiting from social distancing policies reported big losses. Netflix, Zoom Video Communications, and PayPal were among the biggest losers.
Nasdaq’s bullish trend fades
Nasdaq index has generated substantial gains due to the coronavirus spread in the past two quarters as internet stocks have benefited from social distancing policies. The tech-heavy index soared from 6800 levels in March to 12000 points at the beginning of this week.
Shares of streaming company Netflix fell 8% while PayPal stock price slipped almost 9% on vaccine discovery.
The stock price of pandemic darling Zoom Video Communication fell 18% on the COVID-19 vaccine announcement. Its shares jumped more than 650% this year as social distancing policies forced people to use communication tools for remote work.
Shares of the world’s largest e-commerce company Amazon fell almost 5% in Monday trading as traders believe consumers will again shift to traditional shopping venues once the threat of virus ends.
Dow Jones Industrial Average and S&P 500 Soars on Vaccine Hopes
Dow Jones Industrial Average, which is directly linked to the economic environment, reported more than 3% gain after the vaccine announcement from Pfizer.
Travel, leisure, and energy stocks are among the biggest gainers. Shares of passenger air carrier United Airline soared almost 19% on vaccine hopes.
Oil price soared more than 10% in early Monday trading, but concerns over the short-term demand reversed all the gains at the end of the session.
“A viable vaccine is unequivocally game-changing for oil – a market where half of the demand comes from moving people and things around,”
JP Morgan said in a note.