July 28, 2020
The EU market recovery from COVID 19 is gaining momentum, albeit with potential headwinds as Spain started locking down parts of its country with a second wave starting (Catalonia particularly hard hit).
The good news at the end of last week was the completion of an EU recovery fund - a 750bn Euro package, which will mean large scale borrowing on the capital markets - and the services sector reporting a rebound in strength during July (source: HIS Markit flash purchasing manager index). The manufacturing index also rose.
Oxford University’s Sarah Gilbert, a genius vaccinology professor & scientist, is leading the way for a vaccine to the COVID 19 virus. While there is a long way to go, it is possible that a vaccine could be in circulation for patients end of this year or early next. Of course, a lot has to happened before then but it is encouraging. Sarah’s story and foresight is quite remarkable.
US to pass new stimulus bill this week
It will be close to the wire and there are still a number of disagreements to work through between Democrats (house majority) and the republicans (senate majority), however, it is clear that without a renewal package, the economic fallout at the end of this week (when the current stimulus ends) would be extremely bad. In a recent poll 15% of mortgage holders felt that they could not, or it was unlikely they could make their mortgage payment without government help. It was higher for renters at 35%. So, confidence in a deal being done is relatively high.