Health stocks have come back from recession levels in recent weeks. Considering that markets have absorbed both positive and negative knowledge about the Covid-19 pandemic, the markets as a whole have sprung into action.
If crises start with hysteria and over-reaction, when a truer image emerges they can quickly correct themselves.
Health stocks look well-placed to lead the recovery. One clear explanation for this: Health services have been in great demand, with large sums of public money being diverted into research and infrastructure.
Study on Vaccines
There are currently more than 70 vaccines under development for Covid-19. Governments are likely to richly reward companies which are first to produce a secure, effective vaccine.
The list of participating companies includes major players such as Gilead Sciences and Pfizer, and smaller biotech firms. It is the latter which probably has the greatest potential for substantial growth in its share value.
With the most likely outcome being a range of different viruses adopted in different countries in the coming months and years there are likely to be a number of opportunities for investors.
It’s not about all the vaccines. The crisis in some of the world’s largest health systems has revealed major shortcomings. A lack of supplies, medicines and human resources made attempts to contain the virus more difficult.
Sourcing PPE and anti-viral drugs has been a challenge, with manufacturers struggling to meet demand.
When the initial crisis ends, it is likely that as many countries as possible will look to stockpile. This would definitely mean the need to increase total production efficiency as well.
This sustained rise in demand is likely to raise stocks of biotech, pharmaceutical, and medical devices.
It could give AI solutions a further boost too. In some hospitals, robotic devices are already being used to deliver virus and bacteria which kill ultraviolet light blasts.
A Time Of Opportunity
Unless the epidemic initially sends the markets into a state of shock, the months and years to follow will possibly be a time of opportunity.
Those companies who are well-positioned to support the need for greater protection in the face of viral and other threats are poised to benefit in the future.