Covid-19 cases are rebounding in many parts of the U.S., but Goldman Sachs analysts believe the so-called "Delta" variant of the coronavirus is not a cause for concern when it comes to the U.S. economy.
In a note to clients, Goldman Sachs analyst Laura Nicolae said despite surging case numbers, there is little sign that restaurant bookings and consumer spending more broadly are slowing down.
"Economic activity might decrease more sharply if new virus cases and deaths reach higher levels," Nicolae wrote. "But the combination of the low sensitivity of consumer activity in the U.S. and U.K. so far suggest that the economic effects of a delta outbreak in the U.S. would be modest."
Another investment bank analyst said the same thing last week. "The delta variant should not have significant repercussions for the pandemic situation in developed markets (e.g. Europe and North America, which have [made] strong progress in vaccinations) due to the level of population immunity," J.P. Morgan global markets strategist Marko Kolanovic told MarketWatch.
"The situation is similar to February's B.1.1.7 scare, when defensive positioning (bonds, growth stocks) in anticipation of doom resulted in a month-long rally in bond yields, value and cyclical stocks, and a decline in bonds and growth stocks," J.P. Morgan analysts said.
New COVID-19 cases per day in the U.S. have doubled over the past three weeks.
Infected cases jumped to an average of about 23,600 a day on Monday, up from 11,300 a month ago, according to a Wall Street Journal analysis of data from Johns Hopkins University. All but two states — Maine and South Dakota — reported that case numbers have risen over the past two weeks.