Moderna stock price plummeted on Thursday as markets barely reacted to its latest announcement. The stock dropped by 4.30% to $118.25 over the last day and nearly 4% in the past week. The company’s total market cap has crashed to $45.10 billion over the past few days.
Catalyst Behind Moderna’s Crash
Moderna Inc (NASDAQ: MRNA) is a pharmaceutical and biotechnology company based in Cambridge, Massachusetts. Moderna engages in the expansion of transformative medicines based on RNA therapeutics, primarily mRNA vaccines. The company was one of the biggest winners from the coronavirus pandemic with its only commercial product, the MODERNA COVID-19 vaccine.
Moderna stock price has been under intense pressure this year, plunging more than 34.63% in the year to date. The MRNA stock price was in freefall on Thursday after announcing its latest deal with China. The US drugmaker, Moderna said on Wednesday that it struck a deal with Chinese officials to make messenger RNA drugs for China, despite tension between US and China.
According to a Moderna spokesperson, the US-based biotech company signed a memorandum with Beijing authorities to research, develop, and manufacture drugs that will “be exclusively for the Chinese people” and “won’t be exported.”
“Any medicines produced under this agreement will be exclusively for the Chinese people – who face many of the same health challenges that affect other communities around the world,” the company said in a statement.
With the tension between US and China skyrocketing, investors are worried that Moderna might be caught in the geopolitical crossfires. However, China is the largest single market, therefore making Moderna’s move quite wise in the business sense. Drugmakers have remained interested in expanding in China, which faces an aging population and an increased rate of health concerns, stemming from an increasingly westernizing diet.
Moderna Stock Price Prediction
The daily chart shows that the Moderna stock price has been consolidating for the past few days as macroeconomic headwinds continue to weigh on markets. The MRNA stock price has continued to move below the 50-day and 100-day simple moving averages, with its Relative Strength Index (RSI) moving below the signal line.
Consequently, the Moderna stock price is likely to continue falling in the immediate term as tension between US and China surges. A move below the immediate support level of $115.20 will have sellers targeting the next support at $95.10. However, a flip above the 50-day SMA at $129.40 will allow bulls to push the price higher.
