Please see below weekly news update received from Blackfinch Group this morning. The commentary provides a summary of global events and their effects on the markets.
UK COMMENTARY
- Prime Minister Boris Johnson was forced to self-isolate after coming in to contact with a Tory MP who later developed COVID-19 symptoms
- UK inflation rose more than expected to 0.7%, driven by higher prices in clothing and furniture, and partially offset by lower prices in recreation, culture and transport
- The Government announced its intention to ban the sale of new cars and vans powered only by petrol or diesel by 2030. It will invest £2.8bn to help build out of UK countries’ charging point infrastructure and the development of long-lasting batteries.
- A Confederation of British Industry (CBI) manufacturing survey showed that manufacturing orders fell at a faster pace in November than in October. The total orders balance fell to -40 from -34. The CBI calculated the figure by subtracting the percentage of respondents reporting a fall in orders from those reporting a rise.
- The Office for National Statistics (ONS) reported that 14% of UK businesses said they had low or no confidence that their business would survive the next three months
- The ONS also reported that UK retail sales volumes increased in October by 1.2% from September’s number, the sixth consecutive month of growth for the sector
US COMMENTARY
- Retail sales data for October came in slightly lower than expected at 0.3% growth, the slowest pace of expansion since April
- Initial jobless claims rose to 742,000 last week, above economist expectations of 707,000
- Treasury Secretary Steve Mnuchin and Federal Reserve Chairman Jerome Powell have so far failed to agree on extending the SME emergency loans package beyond the end of 2020
ASIA COMMENTARY
- More than 15 countries in the region signed the world’s largest trade alliance, the Regional Comprehensive Economic Partnership. Having supposedly taken eight years to finalise, it marks the first single trade agreement involving China, Japan and South Korea. The intention is to gradually reduce tariffs across many areas.
- Japan’s economy showed growth of 5% in the third quarter of the year, bouncing back stronger than expected
COVID-19 COMMENTARY
- Moderna Inc announced that its COVID-19 vaccine was effective at immunising against coronavirus in 94.5% of cases. The results compare favourably to Pfizer’s results. As an added benefit Moderna’s vaccine won’t require the same heavy-duty freezing in transit.
- The UK has signed a deal worth US$125mn to secure 5mn doses of Moderna’s vaccine, due for delivery in spring 2021. The deal will allow 2.5mn people to be vaccinated, with each vaccine requiring two doses.
- The Oxford University and Astrazeneca vaccine also shows encouraging immune responses in the older population. However these results stem from a phase II clinical trial, whereas both Moderna and Pfizer have already taken part in phase III trials.
We will continue to publish relevant content and market updates as we enter the final month of an eventful year. Please check in again with us soon.
Stay safe.
Chloe
23/11/2020