More good news on the vaccine front has delivered another confidence boost to global markets with Wall Street building on Friday’s record highs and European markets nearing breakout from the post-trough bottom-to-top range.

Moderna’s positive vaccine news came exactly one week after Pfizer’s with much the same impact on the market. It may not quite be the game-changer of a week ago, but it adds further support to some of the back-to-normal, value type rotation which has been the outstanding impact on markets so far and had reasserted itself by last Friday after a mid-week pause.

The vaccine news sent the FTSE 100 to close to its best level since the pandemic-induced sell-off.

The early June intra-day high at 6,511 is now only a few points above, whilst the record close at 6,484 is near. News that Moderna’s vaccine is almost 95% effective was not a huge surprise to the markets but underscores the faith being shown in the rotational trade out of growth and into value areas of the market.

This would tend to favour the FTSE vs say the DAX.

Again, as we saw with the Pfizer news, the Nasdaq lagged the Russell 2000, but all boats were lifted by the vaccine update. Among the biggest risers yesterday dwell in the airline/travel arena Rolls-Royce, Whitbread, IAG and Melrose, whilst Carnival, Norwegian Cruise Line, Royal Caribbean and United Airlines led the way on the S&P 500 and Boeing notched big gains at the top of the Dow. Ocado and JustEat declined

In the meantime, we may need to endure more hardships – imminent vaccines are the perfect cover for maintaining lockdowns for longer. The economic recovery is going to be patchy and uneven across sectors as lockdowns and other restrictions – not least the fear factor remaining a strong driver of consumer habits – but the vaccine-led ‘back to normal’ direction is now at last clear.

Poor old AstraZeneca shares fell as Moderna (+9% on the day) made the announcement – there is a risk that the high efficacy of the Pfizer/Biontech and Moderna trials kills off some competing candidates in development.

Pfizer shares also fell 4% as its vaccine is not the only show in town. Biontech says its vaccine will be ready for delivery in early January.

The IATA warned that travel restrictions would curtail the rollout of vaccines – perhaps talking its book a bit but it’s got a point when it calls for the reopening of key passenger routes.

Today, European markets were flat to a little negative as investors looked to take stock of the pre-vaccine, post-pandemic outlook. Asian shares were mixed but of note the Nikkei 225 in Japan trades at its highest in almost 30 years.

Tesla shares in Frankfurt rose over 10% after gaining 13% in US after-hours trade following news that the car maker will be admitted to the S&P 500 in December. It’s now less than 10% off its all-time high. Talk of possible inclusion in the S&P 500 was a big factor in driving the stock higher earlier this year and the disappointment of being initially snubbed left the shares down. Inclusion in the index will require funds to buy the stock.

Airbnb announced plans to press on with its stock market listing this year despite the obvious hit to the travel sector from the pandemic.

In a filing on Monday the company reported it had made a profit of $219 million in the third quarter, on $1.34 billion in revenue. This was down on a small amount from the $227 million in profit during the same quarter last year – its only profitable quarter in 2019 – which was on $1.65 billion in revenue.

However, the first half of the year was exceptionally tough for Airbnb as it chalked up net losses of $916 million on revenue of $1.18 billion. It plans to list on the Nasdaq under the ticker ABNB.

The Asian recovery story has been helping to lift the mood – China industrial production up 6.9% in the 12 months to October and Japan’s 5% Q3 GDP rebound are encouraging, whilst a mega trade pact involving 15 key Asian economies is fuelling optimism. Greater Chinese influence in the region is assured – good for GDP but not so good for many other aspects of free society.

The euro shrugged off fears of a full-blown crisis within the EU after Hungary and Poland vetoed the €1.8tn budget and the €750 pandemic recovery fund. As ever with the EU, a way will be found to get around the problem. But it does raise a risk that the ultimate fund is punier than it might have been and arrives far too late. EURUSD trades at week highs above 1.1870 at send time.

Brexit – the endgame approaches. We are in the final few days of talks if, realistically, both sides want to get the treaty ratified at home.

The departure of Dominic Cummings is a problem for the UK government as it seems to strengthen the ‘deal at any cost’ voices within, which weakens the British position and likely as not has only led to the EU hardening its stance.

Expect lots of sources comments on the wires reflecting the posturing that is still going on, but the real work is taking place out of the public gaze. David Frost, the UK’s top negotiator, is reported to have said a deal could be done by next Tuesday.

Cable is steady at 1.32.

Rear-view economic data is meaningless right now due to the combination of near-term lockdowns scrubbing a few percentage points off activity and growth, and the prospect of vaccines seeing everything back to normal next year.

Nevertheless, US retail sales on tap later seen at +0.5% (+0.6% core).

Retailers have done well during the pandemic as consumers have spent less on experiences like holidays and dining out and more on stuff from gadgets to groceries.

But how have consumers in the US fared since the end of $600-a-week stimulus cheques? September saw a blow-out for the sector as retail sales grew at the fastest pace in three months, rising 1.9% after a +0.6% move in August.

Consumers have built up a lot of savings and are ready to deploy these in the economy – October may see another strong month though the election may be a factor.

In September department stores sales rose 9.7%, whilst clothing sales were up 11%, but are still down 7.3% and 12.5% respectively on last year. Meanwhile, Fed chair Jay Powell is to deliver a keynote speech at the 25th Bay Area Business Hall of Fame event, where Nancy Pelosi will be attending.

Oil prices were supported as the JMMC meetings continue with a clear indication that OPEC and allies are looking to postpone the planned increase in production in January by several months.

As part of the deal struck back in April between OPEC and allies led by Russia, daily production cuts would be reduced by 2 million barrels per day from January.

However, with demand slowing amid fresh lockdowns and stifled consumer confidence, it’s thought that OPEC+ will maintain cuts of 7.7 million bpd for a further three to six months, instead of tapering the cut to 5.7 million bpd in January. Forecasts for weaker demand in 2021, with the surplus seen at a max of 1.5m bpd vs 0.2bpd under previous forecast, indicate that OPEC+ will need to act.