The Motley Fool

Here’s where I’d invest in shares following yesterday’s Covid-19 vaccine announcement

Image source: Getty Images.

Was yesterday’s announcement from drugs firms Pfizer and BioNTech a game-changer? The companies reckon preliminary analysis indicates their coronavirus vaccine is likely to be 90% effective. And judging by the reaction of the stock market, everything has changed.

The pent-up potential is shown by shares shooting up

Indeed, well-known names such as Whitbread, British Land, Taylor Wimpey, Lloyds and Burberry shot up by robust single-digit and double-digit percentages. And those moves reflected in the main indices such as the UK’s FTSE 100 and America’s S&P 500.

5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!

According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…

And if you click here we’ll show you something that could be key to unlocking 5G’s full potential...

Meanwhile, England’s chief medical officer, Professor Chris Whitty, Tweeted the news is “very encouraging” and it “demonstrates the power of science against Covid.” He reckons the world needs to continue to suppress Covid, but the news is a “reason for optimism in 2021.”

And I reckon the response of the stock market yesterday demonstrates the pent-up potential in individual stocks. In many cases, the underlying businesses are labouring under the weight of the pandemic. I reckon yesterday’s rocketing share prices are an early indicator of how many enterprises will likely thrive when Covid-19 recedes.

So, I think the strength in the markets yesterday underlines why it’s been a good idea for me to look for decent businesses selling at lower prices. Indeed, the potential behind many businesses will likely make them decent long-term investments. However, I’d be careful about chasing share prices higher now after they’ve risen so quickly. After all, we may still have a long distance to travel with the disease hanging over us.

Sticking to a disciplined strategy

But sticking to a disciplined strategy of hunting for shares showing quality and value characteristics is still a good idea, I reckon. With a long-term investment horizon in mind, it’s a timeless strategy. However, I’d be cautious about getting caught up in the current market euphoria.

Indeed, top investor/trader Mark Minervini Tweeted yesterday that we could be seeing a fear-of-missing-out (FOMO) rally in stocks. He said: “I myself will stick with the same stock-by-stock discipline that has served me well for more than three decades.”

I think that’s good advice because it’s always wise for me to do my own thorough research before buying shares. And Minervini reckons that all volatility in the markets is undesirable – even knee-jerk, snap-back rallies like we saw yesterday. Indeed, there were losers as well as winners yesterday. Those companies benefitting from the pandemic sold off sharply. For example, names such as Synairgen, LoopUp, AO World and others.

Overall, I think yesterday’s news was positive. But the markets have probably over-reacted on the day of the vaccine announcement. I reckon we could see adjustments in share prices in the days ahead and the ‘truth’ about the improved outlook will be found somewhere in the middle ground after shares have settled down again.

But we’ve had a glimpse of a potentially brighter future. So, I’d double up on my efforts to find enduring long-term investments in the days and weeks ahead.

A Top Share with Enormous Growth Potential

Savvy investors like you won’t want to miss out on this timely opportunity…

Here’s your chance to discover exactly what has got our Motley Fool UK analyst all fired up about this ‘pure-play’ online business (yes, despite the pandemic!).

Not only does this company enjoy a dominant market-leading position…

But its capital-light, highly scalable business model has previously helped it deliver consistently high sales, astounding near-70% margins, and rising shareholder returns … in fact, in 2019 it returned a whopping £150m+ to shareholders in dividends and buybacks!

And here’s the really exciting part…

While COVID-19 may have thrown the company a curveball, management have acted swiftly to ensure this business is as well placed as it can be to ride out the current period of uncertainty… in fact, our analyst believes it should come roaring back to life, just as soon as normal economic activity resumes.

That’s why we think now could be the perfect time for you to start building your own stake in this exceptional business – especially given the shares look to be trading on a fairly undemanding valuation for the year to March 2021.

Click here to claim your copy of this special report now — and we’ll tell you the name of this Top Growth Share… free of charge!

Kevin Godbold has no position in any share mentioned. The Motley Fool UK has recommended British Land Co, Burberry, Lloyds Banking Group, and LoopUp Group. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Our 6 'Best Buys Now' Shares

The renowned analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.

So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we're offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our 'no quibbles' 30-day subscription fee refund guarantee.

Simply enter your email address below to discover how you can take advantage of this.

I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement.