Vaccine Endgame
“Asia may benefit by being able to fully function economically while the West waits for full vaccinations,” he said in an interview earlier this month.
Money managers also differ on when the vaccines will lead to a return to normal economies. For Dover, for example, that’s most likely to happen in the second half of 2021. But Ross Cameron of Australian money manager Northcape Capital in Tokyo assesses that more than half the world’s population still won’t be vaccinated by the end of 2023.
“Our sense is markets are way too optimistic on the speed of a global vaccine rollout,” Cameron said. “It will take a lot of time and dollars.”
Cameron said glove makers -- which he’s been investing in for more than a decade -- are likely to be a big beneficiary of the virus shots.
“Administering the vaccine will itself result in a spike in glove demand to protect the health professionals involved,” he said. “Glove demand is likely to remain elevated for at least the next two years.”
Malaysia’s Top Glove Corp., the world’s biggest rubber-glove producer, has already more than quadrupled this year, despite slumping Tuesday after its workers caught the virus, forcing authorities to temporarily shutter 28 of its factories.
India, Indonesia
Vaccines working successfully will also benefit stock markets in India and Indonesia, according to Fidelity’s Ahmed. India has the world’s second-highest virus caseload while Indonesia has recorded the most infections in Southeast Asia. While India’s benchmark equity gauge has posted a gain in 2020, the Jakarta Composite Index has lost more than 9%.
Evan McCulloch, director of equity research for Franklin Equity Group and the lead portfolio manager of the Franklin Biotechnology Discovery Fund, sums up how the fund managers, despite differences in their strategies, are generally looking beyond new waves of the virus and the return to lockdowns in many countries.
“We are long-term investors,” he said. We “are looking through the rising case numbers and continued economic weakness towards a reopening of the economy enabled by the vaccine.”
This article was provided by Bloomberg News.