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Contents Click on the links below to get to the stuff you really really want. USA – Record new virus cases and no progress on stimulus package sink stocks (#USA) UK – Tech and oil lead declines (#UK) Continental Europe – SAP issues bleak outlook, its share price plummets, tech sector battered (#Europe) Elsewhere – Australian mining stocks lead declines (#Elsewhere) WTF – A feel-good story (#WTF) Links (#Useful) Numbers (#Numbers) Ts & Cs (#Ts+Cs)
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USA
Stocks tanked all over the place yesterday as virus cases hit new records and no meaningful progress was made on negotiations over a stimulus package. That led to the biggest drop in the S&P 500 for over a month; it closed 1.9% lower.
With 83,000 new infections on both Friday and Saturday, White House Chief of Staff, Mark Meadows, indicated that the US would now be unable to get control of the Covid-19 pandemic. Perhaps he thought they did have control at some point, I don’t know.
In my desperate attempts to try to find something else to tell you about I note that new home sales in the US fell more than expected in September, while the Chicago Federal Reserve’s national activity index also showed a decline. The one sliver thread was a rise in the Dallas Federal Reserve’s manufacturing index. Yay.
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UK
More virus cases means more restrictions and that means households and businesses coming under more financial pressure, some of which will cause permanent damage if it hasn’t already.
And with an opening sentence like that, you can guess how UK stocks performed yesterday: the FTSE 100 and FTSE 250 slumped by 1.2% and 1.4% respectively.
Tech stocks were battered by news from Germany while oil stocks were next worst as folk anticipated lower industrial activity and, therefore, lower demand for oil sending its price down and dragging oil-industry companies down with it.
The demand for and prices of benchmark 10-year Gilts (government bonds) were fairly steady, having fallen lately as folk look ahead to a world with a vaccine. We’ll see how long that sentiment lasts.
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Continental Europe
It was all about one company on the continent yesterday. Technology software giant SAP slumped by the most in its history in one day after posting a bleak outlook and disappointing results. It tanked by 16.3% on the day.
That sent shockwaves through the international technology sector, undermining confidence in the sector that has driven stock prices since the pandemic began. As elsewhere, the oil sector also had a rotten day, and travel and leisure stocks didn’t have much fun.
The Euro Stoxx 50 and German DAX sank by 2.9% and 3.7% respectively.
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Elsewhere
Australian stocks had a particularly bad day today. The S&P/ASX 200 sank by 1.7% with mining giant BHP Billiton leading the declines. Australia has a massive mining sector and a slowdown in global economic activity dents the Australian mining sector.
Elsewhere the situation has been less bad so far this morning. Chinese and Indian stocks are up and the declines registered elsewhere are nowhere near as bad as those of Europe and the US yesterday.
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WTF (What’s The Fact?)
A feel-good story
This is a link to a short video on the BBC that shows a man with dementia who is also a composer. He is seen playing a piece that he wrote and then, well watch it for yourself. It’s a heart-warming start to the day.
www.bbc.co.uk/news/av/entertainment-arts-54694207
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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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