Welcome to the Weekly Scan. Here’s what we’re following for the week of December 14, 2020.
Vaccination nation. An intensive-care nurse in Queens, New York received the first dose of Pfizer and BioNTech’s Covid-19 vaccine on Monday, as medical centers around the U.S. began the largest inoculation program in the nation’s history. The Food and Drug Administration (FDA) approved Pfizer and BioNTech’s Covid-19 vaccine for emergency use on Friday, December 11, 2020. Over the weekend, Pfizer shipped 3 million of the 25 million doses it’s promised to the U.S. The U.K. and Canada began their inoculation programs days earlier with the Pfizer vaccine, which reportedly demonstrates 95% efficacy against the coronavirus.
- The takeaway: Pfizer and BioNTech’s vaccine uses a synthetic messenger RNA to produce an immune response, a technique that has never been tried in humans before. Vaccine approval, achieved in less than one year, comes as nearly 300,000 Americans have died from Covid-19, at a rate of approximately 3,000 Americans a day in recent weeks. Other drug companies, including Moderna and AstraZeneca, are also working on vaccine approval. Pfizer’s vaccine requires two doses, and needs to be stored at sub-zero temperatures, creating logistics and delivery issues. Effective vaccines and treatments are seen as necessary to fully reopen the economy.
Airbnb books room on the Nasdaq. Airbnb, the online platform that connects homeowners who want to rent out space to customers looking for accommodations, saw its price per share nearly double to $146 when it began trading on Friday, December 11, compared to its issuing price of $68 per share. The public offering brought Airbnb’s valuation to $100 billion. It’s important to know that following an IPO, a new stock can be subject to significant increases or decreases in market price. That’s known as volatility. Stock volatility can be particularly high in the first few months following an IPO and as a result, so can the potential for short-term losses
- The takeaway: Airbnb’s IPO was one of the largest in 2020, raising $3.5 billion for the company, despite the pandemic’s negative impact on the travel and vacation business. Airbnb’s revenue fell 80% and the company consequently laid off 1,900 employees in the first months of the pandemic. Although Airbnb had a profitable third quarter in 2020, the company has never had a profitable full year. More companies have gone public in 2020 than in any other year since the late 1990s. Online food delivery company Doordash went public the day before Airbnb, issuing 33 million shares at $102. Its share price increased 85% on its opening day.
The poke war continues. Forty-six states and the Federal Trade Commission (FTC) brought lawsuits against Facebook alleging that the tech giant chokes out competition by buying smaller companies in the social media industry. The suits center around Facebook’s $1 billion acquisition of image-sharing app Instagram in 2012 and $19 billion purchase of messaging service WhatsApp in 2014.
- The takeaway: The lawsuits are the latest attempt by the government to crack down on tech companies for potential monopolization and anti-competitive practices. Both President Trump and President-elect Joe Biden have expressed concerns over the power of tech companies. Two months ago, the Justice Department sued Google for allegedly illegally maintaining a monopoly over internet searches and search advertising.
More stimulus talks. A bipartisan pandemic relief bill worth nearly $1 trillion is working its way through Congress. The bill is reportedly split in two, to rope off more controversial parts of the package for some lawmakers, including increased unemployment benefits, more funding for small businesses, and money for vaccine distribution in states, as well as more general aid to states and schools.
- The takeaway: Congress passed a temporary spending bill last week that will reportedly avoid a government shutdown, giving lawmakers until December 18, 2020, to pass both another stimulus package as well as the budget for the 2021 fiscal year. As of November, 10.7 million people remain unemployed, and businesses across the nation remain closed due to the pandemic.
Find out what we covered in last week’s Scan.