Latest Economic & Market Update 18th August 2020

18th August 2020

Good afternoon, it is August 18th 2020 and here is your economic and market update from BlackBee. 

Today’s focus:

  • S&P moves closer to all-time high.
  • A resurgence of cases and government restrictions hamper travel industry recovery.
  • US-China tensions continue to rise.

The S&P500 climbed closer to an all-time high of $3,386.15, closing at $3,381.99 after increasing 0.27% on Monday. The Dow Jones Industrial Average fell -0.31% and the Nasdaq climbed 1.002% higher. In Europe, the Stoxx Europe 600 closed 0.32% higher. Stocks in China increased following fresh government stimulus.

As countries went into lockdown in March to flatten the curve of coronavirus cases, the tourism and travel industry had hoped that by the end of summer or the start of autumn there would be a noticeable pickup in traveller numbers if the curve was successfully flattened. Ryanair aimed to be back at 70% of capacity by September. However, despite flattening the curves, a recent resurgence of coronavirus cases and governments imposing restrictions on travel has left Ryanair’s target looking very unlikely. Ryanair stated on Monday that there has been a drop off in bookings as people grow more cautious regarding the increase of cases. As a result, they will be cutting their flight schedule, focusing on countries who have been hit worst by the resurgence. The recent resurgence of cases has dashed hopes of a recovery in the near term for the travel and tourism sector

Tensions between the US and China continue to increase. If Huawei is involved in a transaction at any stage, no company worldwide can sell semiconductors using US technology without a licence. The new sanctions severely impacts Huawei and will no doubt benefit its competitors. The tough stance on China is part of President Trump’s campaign for November’s Presidential Election and as a result, could see tensions continue to rise between now and the November.

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

Global Market Update
(as at close of markets 17/08/2020)