D-PIMS Weekly Market Update - Week of 1st to 7th February 2021
Today’s Monday Update:
Over the course of last week, most headlines were a little more varied this week, but still heavily economic or Coronavirus related:
• On Monday Royal Dutch Shell gave details of its plan for the future to slash greenhouse gas emissions. It is betting on its expertise in power trading and rapid growth in hydrogen and biofuels markets, as it shifts away from oil, rather than joining rivals in a scramble to invest billions for renewable power assets, company sources said. The Anglo-Dutch company will, however, keep its overall oil and gas output largely stable for the next decade to help fund its energy transition, though gas is set to become a bigger part of the mix, the sources told Reuters.
• On Tuesday, Asian stock markets gained for a second day on Tuesday on increased optimism about economic stimulus and global recovery. Markets were buoyant ahead of negotiations between U.S. President Joe Biden and Republican senators on a new $1.9 trillion COVID support bill.
• On Wednesday, Britain’s GlaxoSmithKline and German biotech firm CureVac announced that they have teamed up in a 150 million euro deal to develop a COVID-19 vaccine from next year, that could target several variants with one shot.
Britain will publish its aviation recovery plan later this year, transport minister Grant Shapps said on Wednesday, adding that he could not give more detail on the timing because of uncertainty caused by coronavirus. “The best I can give you right now is later this year,” Shapps told a parliamentary committee when asked about the recovery plan, adding that the date of publication would become clearer in the next few weeks. The industry, which has already shed 45,000 jobs, has repeatedly asked the government for more sector specific support.
The United States and Russia said on Wednesday they had extended the New START arms control treaty for five years, preserving the last treaty limiting deployments of the world’s two largest strategic nuclear arsenals. U.S. President Joe Biden, acted quickly to extend the treaty, after his predecessor Donald Trump tried in vain to tie it to three-way talks with China covering its far smaller arsenal.
• Britain on Thursday launched a trial to assess the immune responses generated if doses of the COVID-19 vaccines from Pfizer Inc and AstraZeneca Plc are combined in a two-shot schedule. The British researchers behind the trial, said data on vaccinating people with the two different types of coronavirus vaccines could help understanding of whether shots can be rolled out with greater flexibility around the world. Initial data on immune responses is expected to be generated around June.
Governments and developers around the world are exploring the potential use of “vaccine passports” as a way of reopening the economy, by identifying those protected against the coronavirus. Those developing the technologies however, say such tools come with consequences such as potentially excluding whole groups from social participation, and are urging lawmakers to think seriously about how they are used.
Sales of electric and plug-in hybrid cars in the European Union almost trebled to over 1 million vehicles last year, accounting for more than 10% of overall sales, data showed on Thursday. The jump in sales shows electrified vehicles are becoming more mainstream products, after years of being a niche market and it came at a time when overall EU car sales plunged nearly 24% to 9.9 million because of COVID-19 lockdowns.
• Britain will place travellers arriving from COVID-19 hot spots in quarantine in hotels from 15th February, the government said, after criticism that it was not moving fast enough to bring in the measure. The mandatory 10-day stay in government-provided accommodation, first announced last month, is designed to tighten borders against mutant strains of the coronavirus which could endanger Britain’s vaccination programme. The quarantine will apply to states on a “red list” where COVID-19 variants are prevalent, including South Africa and countries in South America.
President Joe Biden’s drive to enact a $1.9 trillion coronavirus aid bill gained momentum on Friday, as the U.S. Senate narrowly approved a budget blueprint allowing Democrats to push the legislation through Congress in coming weeks, with or without Republican support.
• Over the week, all the main Global Stockmarkets were up, with the UK’s FTSE 100 being up the least. Markets were buoyed by the progress of Vaccination roll-outs in the UK and US, and also the US Covid relief bill. The investment D-PIMS Portfolios were well up, especially the higher risk Portfolios. They were helped by their US and UK domestic allocations. UK Mid and Small company markets, performed much better than the FTSE 100, which consists of only the largest companies listed in the UK.
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The comments made above represent our interpretation of events and market views and are in no way a guarantee of future investment performance.