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Markets fall on Omicron fears

Officials offer vaccine reassurance

LUDWIG BURGER EMMA THOMASSON

FRANKFURT/BERLIN — Financial markets fell sharply on Tuesday after the head of drugmaker Moderna said existing COVID-19 vaccines would be less effective against the new Omicron variant, but they recovered strongly after more reassuring comments from European officials.

European Medicines Agency (EMA) executive director Emer Cooke told the European Parliament that existing vaccines will continue to provide protection.

Andrea Ammon, chair of the European Centre for Disease prevention and Control (ECDC), said the cases of Omicron so far confirmed in 10 European Union countries were mild or without symptoms, although in younger age groups.

The Pan-european STOXX 600 index, spooked by fears that vaccine resistance might trigger restrictions that would choke off a nascent recovery, was down 0.5% at around 1644 GMT, having fallen as much as 1.5% in early trade.

In New York at 1605 GMT, the Dow Jones Industrial Average and the S&P 500 respectively were down about 1.3 per cent and 1.26 per cent.

“There is no world, I think, where (the effectiveness) is the same level . . . we had with Delta,” Moderna CEO Stephane Bancel told the Financial Times.

“I think it’s going to be a material drop. I just don’t know how much because we need to wait for the data. But all the scientists I’ve talked to . . .are like ‘this is not going to be good’.”

The University of Oxford said there was no evidence that current vaccines would not prevent severe disease from Omicron, but that it was ready to rapidly update its shot, developed with Astrazeneca, if necessary.

LAB TESTS

Moderna could not be reached for comment.

Regeneron Pharmaceuticals said its COVID-19 antibody cocktail and other similar antiviral treatments could be less effective against the latest variant.

News of Omicron’s emergence had wiped roughly $2 trillion off global stocks on Friday, after it was identified in southern Africa and announced on Nov. 25.

Yet Dutch authorities said the variant had been detected in the Netherlands as early as Nov. 19, before two flights arrived from South Africa that were known to have carried the virus.

Cooke said lab tests for “cross neutralisation” would take about two weeks. If there were a need to change COVID-19 vaccines, new ones could be approved within three or four months, she added.

“Vaccination will likely still keep you out of the hospital,” said John Wherry, director of the Penn Institute for Immunology in Philadelphia.

Moderna and fellow drugmakers Biontech and Johnson & Johnson are already working on vaccines that specifically target Omicron. Moderna has also been testing a higher dose of its existing booster.

Biontech and Pfizer’s vaccine will likely offer strong protection against severe disease from the new variant, Biontech Chief Executive Ugur Sahin told Reuters.

Sahin said he expects lab tests to show some loss of protection against mild and moderate disease due to Omicron but the extent of that loss was hard to predict.

But border closures have already cast a shadow over economic recovery just as parts of Europe see a fourth wave of infections as winter sets in.

Bank of England policymaker Catherine Mann added to downbeat comments from U.S. Fed Chairman Jerome Powell by saying Omicron could hit consumer confidence, which would not only weaken the British economy’s recovery but could also could push up inflation at the same time.

WORLD

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2021-12-01T08:00:00.0000000Z

2021-12-01T08:00:00.0000000Z

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