November 30, 2020

Stocks Begin The Week On Back Foot; Cryptos Are Up

Stocks Begin The Week On Back Foot; Cryptos Are Up

European and US futures are trading sharply lower on the first trading day of the week as investors monitor progress on the approval of a potential coronavirus vaccine from two pharma companies. The hope among traders is that we will get approval for emergency use for the coronavirus vaccine. 

Overall, November has been a fabulous month for global equities as they up more than 3%. The hope is that we will end the month with these numbers. Next month should also be positive for global equities as historically speaking; holiday spirit usually triggers a Santa rally. 

In terms of economic data, once again, we saw strong numbers out of China, where manufacturing data is firmly in the expansion territory. There is no doubt that China’s economic recovery has been phenomenal, and the country has achieved all of this without creating major chaos. All of this has come when China has faced heavy blame for the coronavirus from the Trump administration and several other nations. 

Brexit and Fisheries 

Sterling is moving higher once again today on the back of Brexit optimism. There are some rumours in the market that the EU block may finally accept the UK’s proposal on fisheries. This means that the transmission period on Fisheries may be allowed. If the rumour is true, this will be a big deal for Brexit, as fisheries have been the most disturbing topic between the EU and the UK, and if any one of them can move or show flexibility on these, we could see the girdlock breaking up, which has been there for several months. The Sterling-dollar is trading at 1.334, and any positive news is likely to push the currency towards 1.35. 

OPEC+ Agreement 

In terms of commodities, today is all about oil. Both crude and Brent prices are trading lower as it seems that there may not be a positive agreement among the OPEC+ cartel on the oil supply. The market has been expecting an extension of the current agreement. The cartel decided to cut their oil production to address the weak oil demand, which is due to the surge in coronavirus. However, it seems like an extension of the current oil production cut isn’t likely. If OPEC+ agrees to increase oil production, and the coronavirus situation continues to impose more restrictions, we could easily see a bigger glut in the market. 

Two Companies 

Two companies are very likely to be in the news headlines in the coming days, and they are Airbnb and DoorDash. People familiar with the matter have said that both companies are set to post higher valuations than previously expected, and this means that their upcoming IPO will be even more exciting. 

Coronavirus Update 

There are over 11 million cases confirmed in the EU in terms of coronavirus update, and Covid-19 has claimed approx 261K souls in Euro. The UK remains one of the worst countries hit by the pandemic with more than 1.64 million cases.

Cryptos 

Cryptos have begun the week on positive sentiment as Bitcoin’s price is back above the critical level of 17K, a gain of 10%. However, XRP is taking the lead as the coin is up over 14% today, and the chances are that it can easily break above the high of 0.78, which was formed last week.