Market Update

As illustrated in the accompanying table, global equity markets concluded the week on a positive note.
Regrettably, the UK's FTSE-100 didn't perform as strongly due to the imposition of stricter-than-expected regional coronavirus lockdowns and the robustness of the pound, which surged by over 3% this month amid speculations of a Brexit deal. This surge adversely impacted the FTSE-100, given that about two-thirds of its total revenue comes from overseas sources. A stronger pound reduces returns for exporters and the value of foreign earnings.
However, amidst these challenges, the individual stocks and sectors across major global equity markets sent a resounding message: the coronavirus vaccines developed by Pfizer, Moderna, and AstraZeneca signify the beginning of the end of this devastating outbreak. While the grim statistics of rising infections, hospitalizations, and deaths may seem overwhelming, these vaccines represent a beacon of hope, indicating the possibility of reopening and sustaining the global economy.
Furthermore, equity markets found support in the conclusion of the US presidential election, as the formal transition from Donald Trump to Joe Biden commenced. Additionally, this week's economic data exceeded expectations. Notably, Monday's (November 23, 2020) US PMI (Purchasing Managers' Index) data not only surpassed predictions but also indicated an acceleration in the expansion of the US economy, the world's largest.
Therefore, it is crucial to look beyond the current bleak headlines and focus on the brighter prospects that 2021 holds. In the long term, equity markets appear attractive in a post-coronavirus world, with widespread recovery anticipated in both economic activity and company profitability.
We anticipate the return of a Goldilocks environment, characterized by global economic growth alongside subdued inflation. This scenario suggests that major central banks, including the Fed, BoE, ECB, and BoJ, will maintain loose monetary policies.
Looking ahead, the economic calendar for this week is relatively subdued. The most notable event will be the release of the weekly US jobless claims data on Thursday (December 3, 2020), especially following this week's slightly disappointing reading. Additionally, the US employment data, including non-farm payrolls, the unemployment rate, participation rate, and average earnings, will be released on Friday. Other significant US data includes the ISM (Institute for Supply Management) report, trade balance, and factory orders.
Internationally, there will be Eurozone CPI inflation and retail sales data, Japanese industrial production and retail sales figures, and Chinese PMI (Purchasing Managers' Index) data to watch.