Friday, 25 September 2020

Markets mixed, COVID-19 cases hit record highs in Europe

Markets were mixed on Thursday.

The S&P 500 rose 0.3 percent but the STOXX Europe 600 fell 1.0 percent and the Shanghai Composite tumbled 1.7 percent.

Megan Horneman, director of portfolio strategy at Verdence Capital Advisors, noted: “People are getting concerned about what kind of economic recovery we’re going to get in the next few months.”

Indeed, Goldman Sachs has slashed its US fourth-quarter GDP forecast to 3 percent from 6 percent on an annualised basis, noting that “any further fiscal support will likely have to wait until 2021”.

In Europe, the resurgence in COVID-19 remained a concern as the number of cases reached a record high of 52,418 over a rolling seven-day average on Tuesday, according to CNN.

The UK recorded its highest number of daily cases on Thursday at 6,634, and credit rating agency S&P Global now sees the UK GDP declining 9.7 percent this year.

Peter Drobac, a global health physician and director at Oxford University's Skoll Centre for Social Entrepreneurship, said that “we're losing control of this” and warned that “winter could be a perfect storm”.

Thursday, 24 September 2020

US stocks plunge as economic recovery loses momentum

Markets were mixed on Wednesday.

The S&P 500 plunged 2.4 percent but the STOXX Europe 600 rose 0.6 percent. The Nikkei 225 dipped 0.1 percent.

Data from IHS Markit on Wednesday showed that its flash US composite PMI slipped to 54.4 this month from 54.6 in August while its flash eurozone composite PMI fell to 50.1 in September from 51.9 in August.

“The news flow has been negative on the virus and negative on growth,” said Ben Randol, senior FX strategist at BofA Securities.

“We’re at that phase where it’s harder to get that next bit of the recovery, that next bit of the reopening in place,” said Jason Pride, chief investment officer of private wealth at Glenmede.

Wednesday, 23 September 2020

Markets rise, UK reimposes COVID-19 restrictions

Markets were mostly higher on Tuesday.

The S&P 500 rose 1.1 percent while the STOXX Europe 600 rose 0.2 percent.

Earlier in the day, though, Asian markets fell, with the Shanghai Composite declining 1.3 percent.

The resurgence in COVID-19 cases remained a concern, dragging down many airline and travel-related stocks.

UK Prime Minister Boris Johnson told the British people on Tuesday to work from home where possible and ordered restaurants and bars to close early to tackle the resurgence in the country.

“We reserve the right to deploy greater firepower, with significantly greater restrictions,” he told parliament.

In the US, the death toll from COVID-19 exceeded 200,000 on Tuesday, by the far the highest number of any nation.

The University of Washington’s health institute is forecasting that the death toll will reach 378,000 by the end of 2020.

Tuesday, 22 September 2020

Markets fall amid reports of illicit bank transfers

Markets fell on Monday.

The S&P 500 fell 1.2 percent, the STOXX Europe 600 sank 3.2 percent and the Shanghai Composite fell 0.6 percent.

Markets took a hit after reports indicated that several global banks moved large sums of allegedly illicit funds over a period of nearly two decades.

The resurgence of COVID-19 in Europe also took a toll on markets, with UK scientists warning on Monday that the country could see almost 50,000 new cases per day in mid-October.

Saturday, 19 September 2020

Markets fall amid US-China tension and Europe COVID-19 resurgence

Markets were mostly lower on Friday.

The S&P 500 fell 1.1 percent and the STOXX Europe 600 fell 0.7 percent.

Earlier in the day, though, the Shanghai Composite jumped 2.1 percent.

Concerns about tensions between the US and China increased after the US Commerce Department said on Friday that it is prohibiting transactions involving Tencent’s WeChat and Bytedance’s TikTok, adding that “the President has provided until November 12 for the national security concerns posed by TikTok to be resolved”.

In Europe, concerns over the resurgence in COVID-19 was the focus of investors as several countries announced new restrictions on movement.

“We are now seeing a second wave coming in,” said UK Prime Minister Boris Johnson.

“If the uptick in cases becomes strong enough that lockdowns have to be tightened to a point that it derails the economic recovery, then it becomes a risk factor,” said Mobeen Tahir, associate director of research at fund house Wisdom Tree.

Friday, 18 September 2020

Markets fall, COVID-19 situation in Europe “very serious”

Markets fell on Thursday.

The S&P 500 fell 0.8 percent, the STOXX Europe 600 fell 0.5 percent and the Shanghai Composite fell 0.4 percent.

Following Federal Reserve chairman Jerome Powell's remarks on Wednesday that the economic downturn in the US is “the most severe in our lifetime”, World Bank chief economist Carmen Reinhart said at a conference on Thursday that a full recovery of the global economy “will take as much as five years”.

Indeed, Europe is seeing a renewed surge in COVID-19 cases.

“We have a very serious situation unfolding before us,” WHO’s regional director for Europe, Hans Kluge, said Thursday in a press briefing on the epidemiological situation in the region. “Weekly cases have now exceeded those reported when the pandemic first peaked in Europe in March.”