Weekly Market Insight

Latest Economic & Market Update 24th November 2020

24th November 2020

Good afternoon, it is November 24th 2020 and here is your economic and market update from BlackBee. 

Today’s focus:

  • Irish consumer sentiment at highest since March – KBC
  • Oil prices touch highest level since March

Irish consumer outlook rose for the month of November according to the results of KBC’s latest consumer sentiment survey. The index reading for November was 65.5 up from October’s measurement of 52.6. The reading in January was 85.5 while the 25- year average is 87.0. On this basis, consumer confidence clearly still has room to grow. November’s index level is the highest since March so the increase in optimism will be a welcome indicator for the Irish government, businesses and investors. Interestingly the survey period for November was November 3rd to 13th. KBC reviewed results before and after Pfizer’s 90% vaccine announcement on November 8th and could not find a significant difference in responses. KBC’s November release states “There is little indication in these data that the mood of Irish consumers was markedly affected by encouraging news on the vaccine front”. The survey component with the largest monthly improvement was in relation to job outlook. KBC highlight job announcements in pharma, pizza and digital media companies as signs of the “underlying resilience of the Irish economy”.

Oil traders are beginning to show signs of belief in the Covid-19 vaccine news as Brent crude prices have hit the highest level since March. The nearest to delivery oil future contract is trading at $46.54 (as of 13:30). The oil sector is one of the worst-hit globally since the pandemic due to a slowdown in industrial output and seismic shocks to the aviation industry. The yearly average for the last three years is trending downwards, however. In 2018 the average price for the year was $71.69, down to $64.16 in 2019 and YTD 2020 is $42.56. Current risks in the oil industry include US President-Elect Joe Biden’s preference for more environmentally friendly fuel sources and also potentially holding out an olive branch to Iran oil exports should the country abide by a nuclear weapons deal. In November 2018, Donald Trump imposed sanctions on Iranian oil products thereby cutting supply levels in the market. For now though, an increase in oil prices is an indication of traders’ optimism that 2021 will see significant increases in industrial production and air travel. (Data Sources: Bloomberg, BBC)

Best & Worst Performers of Large Cap US Stocks on Monday
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Global Market Update
(as at close of markets 23/11/2020)