D-PIMS Weekly Market Update - Week of 15th to 21st November 2021
Today’s Monday Update:
Over the course of the last week, headlines were mostly economic, political and Covid-19 related:
• Royal Dutch Shell said on Monday it would scrap its dual share structure and shift its tax residence and head office to Britain from the Netherlands, seeking to keep investors on board as the energy giant plans a shift away from oil and gas.
Monday, Europe became the epicentre of the pandemic again, prompting some governments to consider re-imposing unpopular lockdowns in the run-up to Christmas and stirring debate over whether vaccines alone are enough to tame COVID-19. Europe accounts for more than half of the average 7-day infections globally and about half of latest deaths, according to a Reuters tally, the highest levels since April last year when the virus was at its initial peak in Italy. Governments and companies are worried the prolonged pandemic will derail a fragile economic recovery. Countries including the Netherlands, Germany, Austria and the Czech Republic are taking or planning measures to curb the spread.
British poultry producers said on Monday there would be enough turkeys for Christmas after the industry focused on delivering whole birds to overcome a shortage of processing workers. Richard Griffiths, CEO of the British Poultry Council, said customers will have less choice this year but insisted everyone who wants a bird will be able to buy one.
Britain's COVID-19 booster vaccine rollout was extended to people between 40 and 49 years old, officials said on Monday, in a bid to boost waning immunity in the population ahead of the colder winter months. The advice comes as the UK Health Security Agency released data from a real-world study which found the booster gave over 93% protection against symptomatic COVID-19 for people aged 50 years and older.
• On Tuesday, U.S. President Joe Biden and Chinese leader Xi Jinping completed their longest exchange as world leaders - but three and a half hours of talks appear to have done little, if anything, to narrow divergent positions between the superpowers. Despite the lack of obvious progress, some Chinese analysts were upbeat and Wang Huiyao, president of the Centre for China and Globalization in Beijing, said that the meeting sent a "very positive signal." "I think it will stop the downward spiral of bilateral relations and will stabilize U.S. China relations for some time," he said, adding that it should also help reduce tensions in the Taiwan Strait.
Figures out on Tuesday, showed that Britain's job market withstood the end of the government's furlough scheme last month, according to data which could ease lingering concerns at the Bank of England about the risks of raising interest rates from their pandemic low. Sterling strengthened as the number of staff on businesses' payrolls in October rose to 0.8% above levels in February 2020, before the coronavirus pandemic hit, and increased by 160,000 on the month.
• Brexit minister David Frost said on Wednesday, that the government's preference is to strike a deal to improve post-Brexit trade arrangements for Northern Ireland and that the agreement can be reached by Christmas. "I think it can be done. Whether it will be done is another question," Frost told BBC Northern Ireland when asked if a deal could be reached by Christmas, as suggested by Irish Foreign Minister Simon Coveney.
British inflation surged to a 10-year high last month as household energy bills rocketed, according to data on Wednesday that will bolster expectations that the Bank of England will raise interest rates next month. Consumer prices rose by 4.2% in annual terms in October, leaping from a 3.1% increase in September. Both the BoE and a Reuters poll of economists - none of whom had predicted such a big increase - had pointed to a reading of 3.9%.
• On Thursday, Belarus authorities cleared the main camps where migrants had huddled at the border with Poland, in what appeared to be a major development in a crisis that has spiralled in recent weeks into an East-West confrontation. European countries accuse Belarus of having deliberately created the crisis by flying in migrants from the Middle East and pushing them to attempt to cross the borders illegally into Poland and Lithuania. Minsk denies deliberately instigating it.
• On Friday, Japan unveiled a record $490 billion spending package to cushion the economic blow from the COVID-19 pandemic, bucking a global trend towards withdrawing crisis-mode stimulus measures and adding strains to its already tattered finances.
British Auction houses and shoppers seeking new clothes for the Christmas holidays lifted British retail sales last month by more than expected, adding to recent signs that a slowdown in the economy might have abated slightly. Retail sales volumes rose by 0.8% month-on-month in October, the Office for National Statistics said. A Reuters poll of economists had pointed to a 0.5% increase. Retail sales are now 5.8% above the level of February 2020, before the COVID-19 pandemic.
• Over the week, the main Global Stockmarkets were mainly down from worries over rising Covid-19 infection rates across Europe and inflation levels. India & China were the worst performers and Japan the best. Apart from the D-PIMS Low to Medium Risk Portfolio, the rest were slightly down for the week. They were helped by their diverse allocations.
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