Europe’s stumbling efforts to contain the coronavirus pandemic look to be yielding results at last.
Germany doubled the number of daily Covid-19 vaccinations, France hit a key immunization milestone a week ahead of schedule, and Italy is set to ease lockdown restrictions as contagion rates slow.
After becoming an epicenter of a renewed surge in the pandemic, there are tentative signs that Western Europe is turning the corner. Stocks in the region hit a record high twice this week, as vaccination campaigns rebound from earlier shortages to boost expectations of a rapid economic recovery. The STOXX Europe 600 Index was on course for another historic high on Friday.
“The bright spot is that the vaccination program is accelerating in the euro area,” Ruben Segura-Cayuela, a Merrill Lynch economist, said in a note to clients. Even recent uncertainty over the safety of AstraZeneca Plc’s shot isn’t undermining targets to inoculate 70% of the region’s population by the end of the summer, he added.
Hard-hit travel and leisure stocks also reached a record high this week, as markets expect that this year’s tourist season won’t be entirely lost to Covid.
Fueling the optimism, Germany said it will be able to comprehensively vaccinate its population by mid summer. As supplies ramp up, Europe’s largest economy could administer 3.5 million doses a week, according to Health Minister Jens Spahn.
Investors have priced in that once the bloc’s economies reopen, consumers will spend savings accumulated during months in lockdown, buoying consumption-led growth, while governments keep their purse strings loose and central banks tolerate higher prices.
German Economy Minister Peter Altmaier fed those expectations on Friday by calling for more aid to pandemic-hit businesses, including a program to help restaurants, clubs and hotels restart after lockdowns unwind.
“It’s encouraging that the number of immunizations is increasing and the risks are bottoming out,” he said in Berlin.
Germany’s Covid-19 vaccinations have jumped after a slow start
Even a spat with the U.K. over exports of AstraZeneca shots — which the EU threatened to restrict — seems to be dying down.
The bloc will receive all doses produced at the drugmaker’s plant in the Netherlands over the coming months, Thierry Breton, the EU’s vaccine chief, said in an interview with the Guardian newspaper.
The comments point to a tacit agreement between the sides. To avoid a renewed showdown, AstraZeneca would temporarily refrain from requesting to export to Britain, and the U.K. wouldn’t make a fuss as long as other shots — such as those from Pfizer Inc. — continued to flow, according to people familiar with the discussions.
The two sides are in talks to try and reach on agreement on sharing doses from AstraZeneca’s Dutch plant, but those negotiations haven’t yet led to a breakthrough, the people said. The company declined to comment.
To avoid future supply shortages, the EU plans to launch a tender for as many as 1.8 billion additional mRNA Covid-19 vaccine doses very soon, according to an official from the European Union’s executive arm. The delivery schedule would be based on monthly obligations, said the official, who asked not to be identified as the information isn’t public.
The bloc’s drugs regulator has current;y recommended two such vaccine — one jointly produced by Pfizer and BioNTech SE and another developed by Moderna Inc. A third made by CureVac NV is under rolling review.
To be sure, not everything is going smoothly. Earlier this week, the European Union failed to form a common position on AstraZeneca’s shot amid links to a rare type of blood clotting, and Eastern Europe continues to struggle with vaccinations.
In Germany, a planned meeting between Chancellor Angela Merkel and state leaders on Monday was canceled because of little prospect of a deal over the next steps to fight the pandemic.
After weeks of political bickering over stricter curbs, Merkel is pushing for greater control and secured a deal with Germany’s 16 states over legislation that will give the federal government greater ability to impose restrictions to tamp down local outbreaks.
Spahn warned Germans that there will still be several difficult months ahead and urged the pandemic-weary public to hold tight a little while longer.
“Yes, I’m suffering exactly like everyone else,” he said. “I want to get out, too. I want the daily routine, too. And I want to celebrate, and I want meals out and shopping.”