Mark to Market: 8 July 2020
Posted:
July 8, 2020

In what seems to be a recurring theme now, European markets have underperformed the US indices. Europe has closed in the red today, with EuroStoxx 50 selling -1.07% to close at 3,286, DAX falling -0.97% to 12,494 and FTSE 100 losing -0.55% to settle at 6,156. In contrast, US indices only briefly dipped their feet into negative territory intraday and closed confidently higher:

  • S&P 500: 3,169.94 (+0.78%)
  • Nasdaq: 10,492.5 (+1.44%)
  • Russel: 1,427.40(+0.81%)

Gains in S&P 500 were driven significantly by Information Technology (+1.60%) and Consumer Discretionary (+1.53%) sectors, while Materials underperformed losing -1.46%. On a single-stocks level, tech names have led the gains with Apple rising 2.33%, Microsoft gaining 2.2% and Amazon closed 2.7% higher at $3,081 per share.

The gains in the US come despite new Coronavirus cases (US and globally) fluctuating around the highs and many states reporting growing new cases. Seems the tech stocks have been the go-to safe-haven assets during on-going economic uncertainty.

In the UK, the Finance Minister announced new measures to help the economy, which include back-to-work bonuses, reduced VAT tax for hospitality and tourism businesses and half-priced meals in August. As with many stimulus packages globally, the implications of this are an ever-rising debt levels and reduced tax income.

Tomorrow, we have Chinese CPI release for June – consensus estimate is 2.5% vs a previous reading of 2.4% – and the usual weekly US jobless claims.

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