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D-PIMS Weekly Market Update - Week of 22nd to 28th February 2021

Today’s Monday Update:

Over the course of last week, headlines were mostly economic or Coronavirus related:

• Reports on Monday, showed around 1,000 European Union finance firms are expected to open their first offices in the U.K., after losing their passporting rights because of Brexit. Roughly two-thirds of the 1,500 money managers, payment firms and insurers that have applied for regulatory permission to continue operating in the U.K. previously had no physical operations in Britain, according to the Financial Conduct Authority (FCA).

Senior Chinese diplomat Wang Yi said on Monday, that the United States and China could work together on issues like climate change and the coronavirus pandemic, if they repaired their damaged bilateral relationship. Wang, a Chinese state councillor and Foreign minister, said Beijing stood ready to reopen constructive dialogue with Washington, after relations between the two countries sank to their lowest in decades under former president Donald Trump.

Results out on Monday, showed the Covid vaccines being rolled out across the UK are reducing the risk of ending up in hospital by about 90%, after one jab. The Oxford/AstraZeneca jab, which was given to more people over 65, reduced the risk by 94%. These results are the first to show how the vaccines are working in the “real world” by preventing serious illness across the UK – raising hopes about the lockdown lifting. The effectiveness of vaccines in reducing hospitalisations and deaths is one of Boris Johnson’s four key measures for easing restrictions.

British Prime Minister Boris Johnson set out a phased plan on Monday to end England’s COVID-19 lockdown, offering a “cautious” approach to try to prevent a return to wholesale restrictions. Johnson, said the first stage would prioritise schools returning on March 8 when only minimal socialising outdoors would be allowed. The so-called roadmap would then pass through four stages, with five weeks in between, and the final step, when most restrictions would be lifted, not starting until June 21 at the earliest.

• Figures released on Tuesday, showed International holiday bookings surged by as much as 600% after the PM laid out plans to gradually relax coronavirus restrictions, giving battered airlines and tour operators hope that a bumper summer could come to their rescue.

The U.S. economic recovery remains “uneven and far from complete” and it will be “some time” before the Federal Reserve considers changing policies it adopted to help the country back to full employment, Fed Chair Jerome Powell said on Tuesday.

• China is ready to enhance exchanges with the United States on the trade and economic fronts, Wang Wentao, the country’s new commerce minister, said on Wednesday. He looks forward to working with U.S. colleagues to focus on cooperation and manage differences, Wang told reporters in a news conference.

European Union leaders agree to work on certificates of vaccination for EU citizens who have had an anti-COVID shot, with southern EU countries that depend heavily on tourism desperate to rescue this summer’s holiday season. With the rollout of vaccines against COVID-19 now gathering pace, some governments, like those of Greece and Spain, are pushing for a quick adoption of an EU-wide certificate for those already inoculated, so that people can travel again.

• On Thursday, details emerged from a large real-world study of the Pfizer/BioNTech vaccine. The independently reviewed study shows the shot is highly effective at preventing COVID-19, in a potentially landmark moment for countries desperate to end lockdowns and reopen economies. The research in Israel - two months into one of the world’s fastest rollouts, providing a rich source of data - showed two doses of the Pfizer shot cut symptomatic COVID-19 cases by 94% across all age groups, and severe illnesses by nearly as much.

• Another COVID-19 study was released on Friday. Researchers analysed results from thousands of COVID-19 tests carried out each week, as part of hospital screenings of healthcare staff in Cambridge. “Our findings show a dramatic reduction in the rate of positive screening tests among asymptomatic healthcare workers after a single dose of the Pfizer-BioNTech vaccine,” said Nick Jones, an infectious diseases specialist at Cambridge University Hospital, who co-led the study. This suggests a four-fold decrease in the risk of asymptomatic COVID-19 infection amongst healthcare workers who have been vaccinated with one shot for more than 12 days, and 75% protection.

• Over the week, all the main Global Stockmarkets were down, with the UK domestically focused FTSE 250 fairing best. Markets were worrying about the prospects of rising inflation as when economic activity rebounds, even though the head of the US Federal Reserve confirmed that they will not be increasing interest rates any time soon. The investment D-PIMS Portfolios were inevitably down, especially the higher risk Portfolios. They were helped to some extent, by the allocations to domestic 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.