Covid Lockdown Restrictions, Mixed China Data and Vaccine Optimism
Fiona Cincotta October 19, 2020 2:52 PM
Signs that China’s economic recovery is gaining momentum, plus covid vaccine optimism, coupled with US fiscal stimulus hopes are just about offsetting fears of rising covid cases in Europe and tighter lockdown restrictions.
Whilst the FTSE looks set to lag behind its peers EU bourses are pointing to a mildly stronger start following an upbeat session in Asia with stocks being propelled up towards recent 2.5 year high. Signs that China’s economic recovery is gaining momentum, plus covid vaccine optimism, coupled with US fiscal stimulus hopes are just about offsetting fears of rising covid cases in Europe and tighter lockdown restrictions.
Concerns over rising covid cases are capping gains. The UK recorded over 16,000 new daily infections as large parts of the country experienced tighter lockdown restrictions and as data revealed that the UK experienced a record number of shop closures during the first half of 2020. With Britain facing increasingly stricter lockdown restrictions heading into winter, in addition to a less generous jobs support package from the government the outlook remains very bleak.
House builders in focus as house prices surge
House builders will once again be in focus as UK house prices continue to surge through October. Another surge in demand for housing pushed up prices by the most in four years. Buyers are proving to be prepared to pay a premium for more space after their lockdown experience. The housing market is clearly in an extraordinary place right now, but with clouds gathering on the horizon as unemployment is set to surge, the strength in the housing market is unlikely to last into next year.
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