Weekly Market Insight

Latest Economic & Market Update 11th December 2020

11th December 2020

Good afternoon, it is December 11th 2020 and here is your economic and market update from BlackBee. 

Today’s focus:

  • CPI falls -1.1% yoy for November.
  • Worrying uptick in New Jobless Claims in the US.

Figures released by the CSO on Thursday show that Consumer Price Inflation for November 2020 was 1.1% lower in comparison to November 2019. The largest falls in costs in comparison to the same period last year were Clothing & Footwear (-7.9%), Household Furnishings (-3.7%), Transport (-3%) and Communications (-2.5%). Costs climbed in the Health (+4%), Alcohol & Tobacco (+1.1%), Restaurants & Hotels (+0.8%) and Recreation & Culture (+0.8%) categories. The main contributing factors to the decreasing prices in the Transport category was a reduction in air fares and lower prices for diesel and petrol but this was partially offset by higher prices for cars and other service costs. Clothing and Footwear fell due to lower sales. Household furnishings fell due to the reduced cost of non-durable household goods, furniture & furnishings. The main contributing factors to the rise in prices in Restaurants & Hotels were primarily higher prices for alcohol and food consumed in licenced premises which was partially offset by a reduction in the cost of hotel accommodation. Health costs rose due to an increase in the cost of medical and dental services. Recreation & Culture costs rose mainly due to higher prices for packaged holidays and an increase in recreational and sporting services costs. The increase in this category was partially offset by lower prices for games, toys & hobbies. (Source: CSO)

New jobless claims in the US climbed to 853,000 last week, up from 716,000 in the week prior. The significant increase in new unemployment claims is a result of a surge in coronavirus cases that has led to a new round of shutdowns and has hampered the labour markets recovery. The number of claims has remained stubbornly high for some time now and the fresh climb in new claims is a worrying sign and highlights the need for further support from the US government. The labour market recovery is vital to kickstart US economic recovery which ultimately has a global knock-on effect. To put the number of new jobless claims into context, the average number of new unemployment claims per week in the US from March 2010 to March 2020 was c.306k per week. Since the 20th March, the average number of weekly unemployment claims has been 1.855 million.

Best & Worst Performers of Large Cap US Stocks on Thursday
Click image to enlarge

Global Market Update
(as at close of markets 09/12/2020)