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D-PIMS Weekly Market Update - Week of 3rd to 9th May 2021

Today’s Monday Update:

Over the course of the last week, shortened by the Bank Holiday, headlines were divided between economic, Coronavirus and global politics:

• Indian opposition leader Rahul Gandhi called for a nationwide lockdown, as the country's tally of coronavirus infections surged past 20 million on Tuesday, becoming the second nation after the United States to pass the grim milestone. Medical experts say actual numbers in India could be five to 10 times higher than those reported. "The only way to stop the spread of Corona now is a full lockdown... Government of India’s inaction is killing many innocent people," Congress party MP Gandhi said on Twitter.

Indian Prime Minister Narendra Modi's government. is reluctant to impose a national lockdown due to the economic fallout, yet several states have imposed various social restrictions. The surge in cases of the highly infectious Indian variant of COVID-19 has swamped the health system

Data out on Tuesday, showed fears that U.S. cities would be emptied by the coronavirus pandemic are giving way to potential signs of revival, according to a series of analyses that suggest any dislocation from the last year will prove temporary. Some data suggest a return is already underway. Cellphone tracking firm Unacast had earlier noted that phone users were shifting their overnight locations out of New York, but now sees them coming back. "New York is growing again," with the city adding a net 1,900 people in the first two months of 2021, versus a loss of 7,100 in the same two months of 2019 and the 110,000 estimated by the company to have left the city throughout 2020.

• On Wednesday, Britain attacked France for “unacceptable” threats to cut off Jersey’s electricity supplies in a row over Brexit fishing rights, with government sources warning that not even the Channel Island’s Nazi occupiers sank so low. A government spokesperson said, “To threaten Jersey like this is clearly unacceptable and disproportionate. “We are working closely with the EU and Jersey on fisheries access provisions following the end of the Transition Period, so trust the French will use the mechanisms of our new treaty to solve problems.

It was announced on Wednesday, that department store retailer Debenhams will permanently close its remaining stores on 15th May, bringing the curtain down on 242 years of trading. Debenhams was founded in London in 1778. While it has struggled for years, the impact of COVID-19 lockdowns, pushed it over the edge.

• U.S. Secretary of State Antony Blinken visited Kyiv on Thursday in a show of support, after Russia massed troops near Ukraine’s eastern border in a standoff that sent alarm bells ringing in Western capitals. Blinken met President Volodymyr Zelensky, mixing solidarity with calls for Ukraine to stick to a path of reforms and fighting corruption. “I’m here really for a very simple reason, which is to on behalf of President Biden reaffirm strongly our commitment to the partnership between our countries".

China condemned on Thursday, a joint statement by G7 foreign ministers that expressed support for Chinese-claimed Taiwan and cast Beijing as a bully, saying it was a gross interference in China’s internal affairs. G7 foreign ministers said in a communique after the London summit that, China was guilty of human rights abuses and of using its economic influence to bully others. In an unusual step, the G7 also said they supported Taiwan's participation in World Health Organization forums and the World Health Assembly - and expressed concern about "any unilateral actions that could escalate tensions" in the Taiwan Strait.

The UK's services sector rebounded in April with growth climbing to a seven-year high as lockdown restrictions were eased, according to an influential survey. The sector, which accounts for 80% of the UK economy, had the fastest rise in output since October 2013. The purchasing managers' index from IHS Markit/CIPS climbed to 61 for April, up from 56.3 in March. Any figure above 50 shows growth in the sector. "April data illustrates that a surge of pent-up demand has started to flow through the UK economy, following the loosening of pandemic restrictions, which lifted private sector growth to its highest since October 2013," said Tim Moore, economics director at survey compiler IHS Markit.

Most of the UK's 50 largest employers questioned by the BBC, have said they do not plan to bring staff back to the office full-time. Some 43 of the firms said they would embrace a mix of home and office working, with staff encouraged to work from home two to three days a week

• U.S. employers hired far fewer workers than expected in April, likely frustrated by labour shortages, leaving them scrambling to meet booming demand as the economy reopens amid rapidly improving public health and massive financial help from the government. Nonfarm payrolls increased by only 266,000 jobs last month after rising by 770,000 in March, the Labour Department said in its closely watched employment report on Friday. Economists polled by Reuters had forecast payrolls advancing by 978,000 jobs. From manufacturing to restaurants, employers are scrambling for workers. A range of factors, including parents still at home caring for children, coronavirus-related retirements and generous unemployment checks, are blamed for the labour shortages. The moderate pace of hiring could last at least until September when the enhanced unemployment benefits run out.

• Over the week, the main Global Stockmarkets were mostly up, the exceptions being in the Far East. The investment D-PIMS Portfolios were up, apart from higher risk portfolios, which were dragged down by their riskier exposures. Overall, the Portfolios were helped by their diverse exposure and domestic UK allocations.

 

The value of investments and the income from them can fall as well as rise and you may not get back the original amount you invested.


Past Performance is no guarantee of, or guide to future returns.


The comments made above represent our interpretation of events and market views and are in no way a guarantee of future investment performance.

 

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