Forty Below Zero
27 April 2020
The global production of oil is as high as it has ever been, but demand has dropped off a cliff thanks to the coronavirus.
5 min read
27 Apr 2020
Economic Highlights
Welcome to our Economic Highlights, bringing you market updates from across the UK, US, Europe and China, as well as the FTSE weekly winners and losers.
Economic data is beginning to catch up with the reality of coronavirus lockdown. Last week saw the release of UK Retail Sales data for March, and even though the harshest social distancing measures were not introduced until later in the month, sales still fell 5.1%, the worst ever seen in this series which dates back to 1996. The ex-fuel number was slightly less bad at -3.7%. Clothing and Footwear was the worst category, falling 34.8%, with Food a strong +10.4%. But off-licence alcohol sales led the pack with a rise of 31.4%. Better than drinking disinfectant.
Purchasing Manager survey data continues to plumb unheard of depths, with the Composite readings coming out at 12.9 in the UK and 13.5 in Europe (with 50 being the threshold between growth and recession). These surveys were not designed to cope with the current circumstances, and we will probably see readings in the 80s when the bounce comes, even if the underlying economic activity will be a lot lower than previously. Best to use them only as a signifier of the trend of activity rather than the magnitude.
In the US, the Weekly Jobless Claims number continued to fall back from its record 6.87 million, and printed at 4.43 million. Hardly cause for celebration, though, when 26.45 million have become unemployed in just five weeks, suggesting that the Unemployment number for April, when published on 8th May, will be close to 20%. What will be much more important will be to see how fast these people are taken back onto payrolls eventually.
Source: FactSet
Source: FactSet