Pfizer ( PFE -5.14% ) received great news last Thursday that an advisory committee to the U.S. Food and Drug Administration (FDA) overwhelmingly recommended Emergency Use Authorization (EUA) for its COVID-19 vaccine. That news was followed by the FDA granting EUA to Pfizer's vaccine over the weekend. But Pfizer's shares slipped on both Friday and Monday after these positive developments. In this Motley Fool Live video recorded on Dec. 11, 2020, healthcare and cannabis bureau chief Corinne Cardina and Fool.com writer Keith Speights discuss why Pfizer stock didn't jump following the good news.
Corrine Cardina: Keith, what have you noticed about the market's reaction so far. I was a little bit surprised to see Pfizer stock just down a hair this morning. Do you think maybe the market had just bid it up so far in anticipation? Now we're just seeing the catalyst in the rearview mirror, what's going on?
Keith Speights: Well, Corinne, there's an old saying among investors: "Buy the rumor. Sell the news." I think we're probably seeing a little bit of that today.
Like I said, everyone has expected this to come about. Everyone expected the Advisory Committee to recommend approval or recommend authorization, rather, for Pfizer's vaccine. Because those expectations were already in investors' minds, I think once the news arrived, it was like, "Okay, now what?"
I think that's where we are. We're in the "OK, now what" stage. What's next? I think that's why you also saw Moderna stock rise a little this morning because now investors are looking for what's next with Moderna. The advisory committee meets to review their vaccine next week. We always talk about the stock market being forward-looking. I think that's exactly what we're seeing with the movement of some of these stocks this morning.