Essential Insights 

  • Asian equities started the week higher amid vaccine hopes along side its US equity counterparts
  • The WHO reported a record single day increase in global covid-19 cases at 308,000 cases
  • An important day in UK parliament as the Internal Market Bill is debated
  • Japan’s Shinzo Abe replacement has been announced with Yoshihide Suga chosen to be his successor

Equities 

U.S. equity bourses caught a bid today amid renewed vaccine hopes, this comes as AstraZeneca announced it will be resuming its phase-3 trial following a halt last week which saw a test patient exhibit a concerning reaction. Although AstraZeneca has been given the thumbs up to resume phase-3, we still do not know the long term implications of the vaccine, I would be very wary in terms of watching how this vaccine progresses. For now, markets are clinging onto an overly optimistic view that the vaccine will be deployed soon. The Oracle Corp gained on reports that it has beaten Microsoft on the bid for the U.S. operations of TikTok whilst the  immunomedics inc gained following an agreement by Gilead Science to buy the company for $21 Billion. This dealing news seems to be adding support for equities, JJ Kinahan at TD has this to say

‘Deal news is always something that gets people excited about the market’

The Dow Jones is up +1.35% on the day along with the S&P 500 Index boasting a +1.73% gain and the NASDAQ composite index up +2.01%. European equity bourses were mixed amid the feat between UK and EU , the FTSE 100 is down -0.10%  whilst the Euro Stoxx 50 is up marginally by +0.03%. Asian stocks rallied towards the upside amid Nvidia’s decision to buy the chip division arm of Softbank for $40 billion, the Nikkei 225 is up +0.65% whilst the Hang Seng Index posted a +0.56% gain.

UK

GBP/USD 

GBP/USD staged a slight rebound overnight and throughout the U.S. trading session after selling off heavily last week, though downside risks remain strong. The retracement is likely due to a slip in the dollar index which is mostly flat on the day. Markets will be focusing on the Bank of England meeting this week (check event calendar and key events to watch out for post) as well as inflation data and the parliament debate around the internal market bill proposed by PM Boris Johnson. There is a growing majority of 80 , however the PM is facing heat from members of his own party. Additionally, the EU have demanded the bill be scrapped by the end of September.

Commodities

Crude Oil remains under pressure, down -0.16% on the day at $37 a barrel, this comes as OPEC have downgraded it’s view on global oil demand ahead of it’s key meeting this Thursday. On Thursday OPEC is expected to hold a meeting with it’s allies to discuss whether the current production cuts are sufficient enough to prevent an oil gut and bolster prices amid a reappearnce of Covid-19 which has seen countries such as the UK hit especially hard, supplemented by rising R (infection rates) and the WHO reporting a single biggest day in global new covid-19 cases, topping 300,000 cases.