Weekly Market Insight

Latest Economic & Market Update 21st July 2020

21st July 2020

Good afternoon, it is July 21st 2020 and here is your economic and market update from BlackBee. 

Today’s focus:

  • European Coronavirus recovery fund agreed at €750bn
  • Investors buy riskier Eurozone debt

On Tuesday morning at 5.31 am, European Council president Charles Michel confirmed a €750bn post-pandemic relief fund had been agreed between heads of government of the European bloc. German chancellor Angela Merkel & French president Emmanuel Macron played an integral part in reaching the agreement. Macron hailed the agreement as “a historic day for Europe” while Angela Merkel said the agreement is “the financial foundation for the EU for the next 7 years”. The recovery fund focuses on €390bn of grants to economically weaker member states, with €360bn worth of loans. To reach a deal, leaders signed up to cuts in top-up funding for EU programmes and a solvency instrument of €26bn to help struggling companies was scrapped due to a complex patchwork of compromises.
Source: Financial times

Following the news of the EU leaders agreed on a recovery package, Germany’s main stock index shed its recent losses as investors moved into riskier bonds. On Tuesday the DAX index of German blue-chip bonds rose 1.6%, pushing it into positive territory after been down 35% for the past four months. The Euro gained 0.1% to 1.1458 against the Dollar, still at a four-month high, however investors continue to purchase safe-haven assets with Silver reaching a four-year high and Gold hitting 1,820 per troy ounce, the highest in nine years. Oil prices edged higher with the international benchmark up 0.6% to $43.55

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

Global Market Update
(as at close of markets 20/07/2020)