An apparent end to post-election uncertainty in the United States allied to yet more positive vaccine news has driven stock markets to new highs last week.
Reports that the coronavirus vaccine being developed by AstraZeneca in collaboration with Oxford University has proved effective in stage three trials added extra impetus to markets on Monday 23 November, following similar results from both Moderna and Pfizer earlier this month.
The US
Wall Street may have had a shortened trading week as a result of the Thanksgiving break, but both the Dow Jones Industrial Average and the S&P 500 managed to hit new all-time highs on Tuesday. This was in the wake of the news that the General Services Administration had finally agreed to recognise Biden’s victory, a step which gives the Democrats access to the resources and information needed to plan for a smooth transition.
While the Trump campaign has indicated it will continue its legal battle, this move by the GSA has been seen as confirmation that the current president now stands almost no chance of convincing either the courts or state legislatures to overturn Biden’s significant electoral college lead. As a result, the Biden team should be better placed to get to grips with the Covid-19 pandemic, which is continuing to worsen across the US. A smoother transition may also increase the chances of lawmakers in Washington reaching agreement on an urgently needed economic stimulus package.
The UK and Europe
In the UK, the FTSE 100 ended Thursday 0.2% ahead for the week, with major firms again enjoying mixed fortunes. Reports that the UK government was considering plans to allow foreign travellers to avoid quarantine upon their return from overseas if they paid for a coronavirus test helped boost shares in some travel companies.
But the beleaguered hospitality sector was hit by news that more than 40% of the population of England would be placed under Tier 3 restrictions when the current lockdown ends on December 2. This means that pubs, restaurants and cafés will be permitted to operate on a takeaway-only basis.
20/11/2020 | 26/11/2020 | Change (%) | |
|---|---|---|---|
FTSE 100 | 6351.5 | 6362.9 | 0.2 |
FTSE All-share | 3586.5 | 3589.0 | 0.1 |
S&P 500 | 3557.5 | 3629.7 | 2.0 |
Dow Jones | 29263.5 | 29872.5 | 2.1 |
DAX | 13137.3 | 13286.6 | -2.8 |
CAC-40 | 5495.9 | 5566.8 | 1.3 |
ACWI | 609.5 | 621.3 | 1.9 |
Note: all market data contained within the article is sourced from Bloomberg unless stated otherwise, data as at 26/11/2020.
