London Capital Group | Oct 19, 2020 10:18
China GDP grew 4.9% in the third quarter, slightly missing estimates - - Stocks are bouncing back from last week's sell-off on hopes for US stimulus
Good morning. There could be a coronavirus stimulus bill within 48 hours and an emergency-use COVID-19 vaccine by November. China GDP expanded again in Q3 but by less than forecast. Markets are looking through the EU-UK trade deal standoff in the belief the two sides will find a compromise. Rising coronavirus cases saw Switzerland mandate wearing masks in all indoors public spaces.
European stock indices are rising on Monday having survived last week's sell off. Investors got nervous last week but aren't ready to pick a direction before the US election.
Last week chances for a stimulus deal had dimmer and now it looks a little brighter, and the price action is reflecting it. The rising COVID cases in Europe and elsewhere is putting pressure on lawmakers to take action.
China's economy grew by 4.9% y/y in the third quarter – its less than the 6% run-rate over the past few years – and below the 5.2% expected. Consumption remains a drag- as demonstrated by retail sales, which rose 3.3% over the month but are down -7.2% in 2020. The second largest global economy back on track is underpinning a lot of the optimism for the global economy next year.
The British pound is a little firmer as of Monday morning amid talk of re-writing of the UK internal markets bill. Despite a public blame game and the idea of an ‘Australia-style' Brexit, markets are pricing-in a final compromise between the EU and UK.
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Written By: London Capital Group
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