02 March 2020
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.
Worryingly, cases in Hubei province in China also seem to be rising again after a lull.Either it just hadn’t started to spread properly yet, or local health authorities had insufficient resources even to diagnose cases, let alone treat them. He was particularly concerned about Africa, India and Indonesia. I note that the first case was reported in Delhi this morning, as was the first in Indonesia. Worryingly, cases in Hubei province in China also seem to be rising again after a lull.
Last week the emphasis shifted to a potential demand shock.The concern was that production in factories across the world could grind to a halt for want of vital components, leaving everything from car dealer forecourts to iPhone shops devoid of stock. Last week the emphasis shifted to a potential demand shock. It started with the curtailment of business travel and cancellation of major trade shows, for example, but soon spread to the postponement of a number of large gatherings and sporting events. Some of this demand will be delayed until confidence returns, but some will be lost altogether.
Friday evening’s strong rally in the United States could have stemmed as much from end-of-month portfolio rebalancing as from any increased optimism.The difficulty of reading markets in the short term is exacerbated by newer structural factors, ranging from computer-driven strategies to reduced trading liquidity. Friday evening’s strong rally in the United States could have stemmed as much from end-of-month portfolio rebalancing as from any increased optimism. Certainly the expectation of further cuts to interest rates is not unhelpful, particularly to companies and individuals who might find themselves cash-strapped in the weeks ahead, but it’s hard to see much incremental demand being created.