Thursday , January 28 2021

Glove stocks rise as Covid-19 rise tests vaccine-based optimism

Kuala Lumpur (November 20): Tire glove makers Top Glove Corp Bhd, Hartalega Holdings Bhd and Supermax Corp Bhd rose among Bursa Malaysia’s top gains in morning trading today as the number of global cases increased. 19 checked investors’ vaccine-based optimism.

At 10:27 a.m. Hartalega was up 40 cents or 2.84% at RM14.50, Supermax was up 39 cents or 5.03% at RM 8.15, while Top Glove was up 19 cents or 2, 74% higher at RM7.13.

Investor trades today were chasing glove maker stocks after falling prices, as news of encouraging results from Covid-19 vaccine trials appears to undermine demand for gloves to curb pandemic spread. .

News of Covid-19 vaccine trials in partnership with Pfizer Inc-BioNTech and Moderna Inc. were closely monitored.

It was reported yesterday that Pfizer and BioNTech said they could secure urgent US and European approval for the Covid-19 vaccine next month, with final test results showing a 95% success rate and no serious side effects.

It was reported that Moderna on Monday published preliminary data on the vaccine which showed 94.5% effectiveness.

“Pfizer said it expects to make up to 50 million doses of the vaccine this year, enough to protect 25 million people and then produce up to 1.3 billion doses in 2021,” Reuters reported.

In Malaysia, RHB Investment Bank Bhd said yesterday that the use of Covid-19 vaccines could be a new source of demand for rubber gloves with up to 18 billion pieces per year, assuming that 60% of the world’s 7.5 billion people will get the vaccine in two doses. annually.

“As any contact with an individual must lead to the use of a pair of disposable gloves, the use of a vaccine will create a short-term demand of 18 billion units per year. If the protection period of the vaccine is only up to one year, this “This equates to 6.8% of the 263 billion units of annual global glove demand in 2019,” wrote RHB analyst Alan Lee.

As glove-related stock prices rise, analysts are aware of the broader economic and market impact of the growing number of Covid-19 global cases.

Reuters reported today that positive news about possible vaccines helped push the MSCI global record to record levels earlier in the week, but investors backed away as many countries announced record infection rates and tighter locks to curb the spread of the virus.

In the Malaysian stock market, Hong Leong Investment Bank Bhd analyst Ng Jun Sheng wrote in a note today that the investment bank reiterated its view that the local stock market is ripe for further consolidation of profits after the FBM KLCI rose from a low 1,452 points to a high of 1,613 due to factors such as prolonged concerns about a fragile global economic outlook due to rising Covid-19 infections and new locks.

“The main supports are connected at levels 1,576-1,555-1,535 while the resistors are close to levels 1,600-1,618-1,633,” Ng said.

In Bursa Malaysia today, the 30-share KLCI rose 4.55 points or 0.29% to 1,588.23 at 11:01 a.m., while the Bursa healthcare index, whose components include rubber glove makers , rose 50.82 points or 1.3% to 3,954.54.

Top Glove and Hartalega are also components of KLCI.

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