Investor response to vaccine signposts sectoral shifts

Significance

Millions of people and companies predict the future every microsecond through their equity investments. Investors’ behaviour following the news of the vaccine success offers an indication of which sectors may change permanently, and how the global economy may look one to two years out.

Impacts

• The post-pandemic economy will be biased towards larger companies with the capital to survive a year or more of lost business.
• Inequality will rise as, while some sectors and their employees will benefit from demand shifts, many jobs and firms will be lost elsewhere.
• As people adopt new habits (eg, more entertainment at home) many may change permanently; firms will be challenged to follow these patterns.