Pfizer’s Covid-19 vaccine announcement last week finally brought some respite for value stocks that had been battered in 2020.

Bespoke Investments notes 34 S&P 500 stocks gained more than 20 per cent on Monday alone, however, all but one of those stocks is still down this year by an average of 36 per cent. Of the 100 best performers that day, six have gained in 2020. In contrast, 22 stocks fell by more than 5 per cent following Pfizer’s announcement. Of those, all but one had gained an average of 45 per cent this year.

In other words, last week was great for 2020's losers but not for 2020's winners. The Russell 1000 value index outperformed its growth counterpart by more than any other day over the last 10 years, notes Rob Arnott of Research Affiliates. Stay-at-home stocks such as Zoom have rocketed higher this year while sectors affected by Covid-19 have tanked, so the violent market rotation was "entirely rational", says billionaire hedge fund manager Stanley Druckenmiller.

Timing market turns is a treacherous business but there is potential for an ongoing shift. Value stocks lagged their growth counterparts by 41.4 per cent prior to troughing in September, says Arnott, the “largest meltdown” since 1931. The valuation spread between the two remains at “breathtakingly wide” levels, so frustrated shareholders will be hoping value stocks are about to shine following years of chronic underperformance.