COVID-19, the disease caused by SARS-CoV-2 (coronavirus), has spread across the globe, and as we enter May, several countries and US states are testing ways to relax lockdowns and provide some relief for the economy.

While we don't think US states will follow federal guidelines for reopening, we expect the transition to be gradual and that they will quickly reverse any moves that lead to a spike in new cases.

Diagnostic testing has improved more rapidly than we anticipated, to around 250,000 a day, and we think a combination of continued social distancing (masks and 2m rule), steady improvement to 800,000 tests per day by the end of the year (which facilitates contact tracing and surveillance), broader availability of Gilead Sciences' remdesivir, and potential targeted antibodies and vaccines by the end of the year in high-risk populations should allow visits to nonessential businesses (restaurants, salons, and retailers) to recover to 30 per cent below prepandemic levels by the end of the year (from a trough at around 65 per cent below in March).

Broader availability of Gilead Sciences' remdesivir, and potential targeted antibodies and vaccines by the end of the year in high-risk populations should allow visits to nonessential businesses, Morningstar strategists say

Infection rate to stay below 10pc

Our new base-case scenario assumes that less than 10 per cent of the US population is infected by the end of 2020, with a 0.7 per cent death rate, as improving levels of testing help control the spread of the disease.

Remdesivir's recent emergency use authorisation (EUA) in severely ill COVID-19 patients is a turning point, but efficacy to date does not look strong enough on its own to justify relaxing lockdowns.

That said, we project US$2 billion in peak sales in 2021, assuming an eventual US price (after donated supplies) of around $500 per treatment.

Vaccine progress has accelerated from an already rapid pace: Moderna, Johnson & Johnson, Pfizer, and AstraZeneca could all receive EUAs by the end of the year.

Assuming that at least two succeed, potential broad availability (billions of doses) would allow near-normal distancing measures by mid-2021.