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Contents Click on the links below to get to the stuff you really really want. USA – Approval of Remdesivir and hopes of stimulus package combined with improved PMI numbers to lift stocks despite rise in virus cases (#USA) UK – Disappointing economic numbers offset by Barclays’ results and optimism from Remdesivir (#UK) Continental Europe – Virus cases up but hopes lifted by vaccine approval (#Europe) Elsewhere – Stocks mostly down (#Elsewhere) WTF – The answer to everything (#WTF) Links (#Useful) Numbers (#Numbers) Ts & Cs (#Ts+Cs)
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USA
Rising virus cases and hopes of a stimulus deal continued to dominate investor thinking. The chances of a stimulus deal being completed and passed into law before next week’s election have pretty much evaporated. In the meantime, virus case numbers are rising, driving concerns that more businesses could suffer irrevocable damage.
Meanwhile, the latest round of purchasing managers’ index (PMI) data came in and were a tad better than expected. The outlook for the coming 30 days as perceived by purchasing managers, is one of increased orders and consumption across all major sectors. But it’s an increase from a low base, so it’s kind of inevitable…unless the virus numbers continue to scupper things.
The net result for stocks was a very modest nudge upwards, leaving the S&P 500 0.3% to the good. Meanwhile, surprise surprise, Remdesivir has been approved as a treatment for Covid-19 just in time for the election. Not predictable at all.
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UK
There was some manufacturing PMI and retail sales data in for the UK as well. The manufacturing numbers reflected a less positive outlook compared to previous months, with lots of progress needed to make up for the damage inflicted by measures necessary to combat the pandemic. Retail sales were up, but the service PMI numbers (much the biggest chunk of the UK economy) were down and suggesting further falls to come in “hard” numbers i.e. the actual sales and revenues rather than just the expectations.
Nevertheless, banks and property companies were among the main winners on Friday though, as Barclays delivered decent results and Brexit talks were extended and the UK government indicated optimism that a deal could be reached. The news that Remdesivir had been approved helped to shift investor focus to six months down the line when the virus might be under control and economic growth recovering in earnest.
The optimism helped to release a degree of hope that the UK might avoid a disruptive exit from the EU, and that pushed stocks up leaving the FTSE 100 and FTSE 250 1.3% and 1.2% higher respectively.
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Continental Europe
European stocks were up to a lesser degree despite virus case numbers continuing to be high, especially in France. But the hope that the US might come up with a stimulus package and Remdesivir’s approval were enough to push the Euro Stoxx 50 and German DAX up by around 0.8% on Friday.
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Elsewhere
Stocks are largely down across the Asia Pacific region this morning. Indian stocks, which tend to do their own thing, have suffered the most, but it’s generally a nervous start to the week for investors.
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WTF (What’s The Fact?)
The answer to everything
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Links
Investopedia (www.investopedia.com/dictionary/) – Loads of free explanations of financial terms including some helpful videos. Not 100% accurate, but a good starting point Guffipedia (ig.ft.com/sites/guffipedia/) – Lucy Kellaway of the FT has collected some painful examples of corporate people disappearing up their own analogies Guardian (www.theguardian.com) – Free to access website with a couple of decent columnists (e.g. Nils Pratley and Larry Elliott) Times of India (timesofindia.indiatimes.com) – Why use five words when 37 will do? Daily Mail (www.theatlantic.com/magazine/archive/2016/07/the-war-on-stupid-people/485618) – Click it. I dare you.
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———————————————————— IMPORTANT This is my opinion. Yes I read a lot and share what I’ve read with you, but this content remains my opinion. It’s NOT advice. If you take my advice – don’t take my advice. Any decisions you make about investments, your hairstyle or whether or not to eat marzipan are entirely at your own behest. If you’re unable to recognise the devil’s ear wax when you see it, then you’re on your own.
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