Sentiment Lifts On Vaccine Optimism and EU Stimulus Deal
Fiona Cincotta July 21, 2020 7:20 AM
Vaccine optimism and EU fiscal stimulus is boosting the mood in the market on Tuesday.
A combination of vaccine optimism and fiscal stimulus is boosting the mood in the market on Tuesday. Encouraging results from Oxford’s vaccine candidate, in addition to EU leaders agreeing to a €750 billion Recovery Fund is overshadowing rising tension between the UK and China and soaring covid numbers in California.
Vaccine optimism continues to underpin the market after Oxford /AstraZeneca reported a good immune response in Phase 3 trials for its vaccine candidate, which crucially had no adverse side effects. Given that a vaccine is the surest, quickest and possibly the only way to return to pre-coronavirus economic growth and normalcy, investors are particularly sensitive to vaccine headlines.
Brexit talks & Mike Pompeo visits
Brexit talks are due to restart today. Hopes and expectations of any agreement are low after recent talks’ disappointment. US Secretary of State Mike Pompeo is also in the UK to discuss China, 5G and free trade deal with Prime Minister Boris Johnson. His arrival comes after Britain suspended its extradition treaty with Hong Kong in retaliation to the national security law imposed by China. The move has stoked tensions between the UK and China accelerating deteriorating relations
There is no high impacting economic data due to be released leaving sentiment to drive the markets. Coronavirus statistics are also likely to remain in focus, particularly after California reported almost 12,000 new cases, taking the total to 400,000. If it were a country it would be up there with some of the highest infected countries.
StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.