Shares of Moderna (MRNA 0.46%) were jumping 2.5% as of 11 a.m. ET on Tuesday after rising as much as 5.6% earlier in the day. The gain especially stood out with the overall market falling due to worries about a potential recession.
Investors appear to be more optimistic about Moderna's prospects after the Food and Drug Administration (FDA) cleared the way for COVID-19 vaccine boosters targeting the omicron variant to be available in the fall. The agency won't require additional clinical trials for the omicron boosters.
The FDA's decision could make it more likely that the U.S. government will place an order for Moderna's omicron-targeting booster. That's especially the case considering that the Biden administration has warned about the possibility of a surge in COVID-19 this fall and winter.
Last week, the U.S. government agreed to buy 105 million additional doses of the COVID-19 vaccine developed by Pfizer (PFE 0.52%) and BioNTech (BNTX 1.48%) for $3.2 billion. These doses could include the two drugmakers' omicron booster.
So far, Moderna hasn't announced an additional supply agreement with the U.S. But investors seem to think that a new deal could be on the way.
Moderna expects its omicron booster will be available by late October or early November. It's possible that the company could land an additional contract with the federal government before then. If so, the news would almost certainly provide an even bigger bump for the vaccine stock.