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D-PIMS Weekly Market Update - Week of 6th to 12th December 2021

Today’s Monday Update:

Over the course of the last week, market moving headlines were mostly economic, and Covid-19 related:

• On Monday, New York City expanded its array of COVID-19 mandates, setting vaccine requirements for children as young as 5 years old and for workers at all private-sector companies as the highly transmissible Omicron variant pushes into more U.S. states. The most-populous U.S. city set a 27th December deadline for all 184,000 businesses within its limits to make their employees show proof they have been vaccinated, and for entry into restaurants and to participate in extracurricular school activities, such as sports, band and dances, Mayor Bill de Blasio said. "Vaccination is the way out of this pandemic, and these are bold, first-in-the-nation measures to encourage New Yorkers to keep themselves and their communities safe,” de Blasio, said in a statement.

A major British study into mixing COVID-19 vaccines has found that people had a better immune response when they received a first dose of AstraZeneca or Pfizer-BioNTech shots followed by Moderna nine weeks later, according to the results on Monday. The findings supporting flexible dosing, will offer some hope to poor and middle income countries which may need to combine different brands between first and second shots if supplies run low or become unstable.

• On Tuesday, U.S. President Joe Biden and Russian President Vladimir Putin held a high-stakes video conference call that Biden used to try to dissuade Moscow from invading Ukraine, where thousands of troops are massed near the border. Ahead of his first direct talks with Putin since July, Biden consulted with European allies to discuss plans for sanctions against Russia and seek a strong allied stance in support of Ukraine's territorial integrity and sovereignty.

British drugmaker GSK, said on Tuesday its antibody-based COVID-19 therapy with U.S. partner Vir Biotechnology is effective against all 37 mutations of the new Omicron coronavirus variant, citing new data from early-stage studies.

Black Friday shopping helped boost total retail sales in November, with clothes and jewellery being some of the more popular items that Brits purchased. Sales increased by 5% in November, compared to a growth of 0.9% in November 2020, according to the British Retail Consortium (BRC)-KPMG monitor. When compared to pre-pandemic levels of 2019, total retail sales grew 4.1%.

• BioNTech and Pfizer said on Wednesday, a three-shot course of their COVID-19 vaccine was able to neutralise the new Omicron variant in a laboratory test and they could deliver an Omicron-based vaccine in March 2022 if needed. In the first official statement from vaccine manufacturers on the likely efficacy of their shot against Omicron, BioNTech and Pfizer said that two vaccine doses resulted in significantly lower neutralising antibodies but that a third dose of their vaccine increased the neutralising antibodies by a factor of 25.

Prime Minister Boris Johnson imposed tougher COVID-19 restrictions in England on Wednesday, ordering people to work from home, wear masks in public places and use vaccine passes to slow the spread of the Omicron coronavirus variant. Johnson said Omicron was spreading rapidly and he had no choice but to move to "Plan B" while a vaccine booster programme rolls out.

• Figures out on Thursday, showed the number of Americans filing new claims for unemployment benefits dropped to the lowest level in more than 52 years last week, as labour market conditions continued to tighten amid an acute shortage of workers. Initial claims for state unemployment benefits tumbled 43,000 to a seasonally adjusted 184,000 for the week ended 4th December, the lowest level since September 1969. Economists polled by Reuters had forecast 215,000 applications for the latest week. Claims have declined from a record high of 6.149 million in early April of 2020. Applications typically increase as the weather gets colder, but economists say this seasonal pattern is not holding because of a tightening labour market.

• On Friday, France said it will ask the European Union to start legal action against Britain if it fails to issue more fishing licences by a Friday deadline set by the European Commission, a French minister said. Fishing represents a tiny share of both the French and British economies, but it is politically sensitive.

Data out on Friday, showed Britain's economy barely grew in October, even before the emergence of the Omicron coronavirus variant, further denting expectations that the Bank of England will raise interest rates next week for the first time since the pandemic struck. Gross domestic product edged up by a weaker than expected 0.1%, slowing sharply from monthly growth of 0.6% in September. Economists polled by Reuters had forecast monthly GDP growth of 0.4%.

• Over the week, the main Global Stockmarkets were up, led by the US, over early signs that vaccines will still give some protection against the Omicron Covid-19 variant. Over the week, all the D-PIMS Portfolios were up, particularly the higher risk portfolios. The Portfolios were helped by their diverse allocations, but also Global and Domestic China allocations.

 

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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.

 

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