fbpx

Daily Market Commentary 28th October 2020

Share This Post

The surge in the coronavirus continues to dominate nervous US and European markets. Europe has been hit hard by a surging second wave, although authorities have resisted a full lock-down of the economy, in an effort to prevent a total economic collapse. The surging virus is damaging, but the mortality rates have crashed and the folly of previous harsh Government lock-downs, have now become apparent. Michel Barnier arrives in the UK for the final negotiations of a possible Brexit trade deal, which may well happen, as the cost of not doing a deal is too great, for both sides. The EUR trades 1.1825, while the GBP rallied to 1.3060, in anticipation.

The surge in the virus is hitting US stock markets hard in the closing stages of the US Presidential campaign. Mortality rates have collapsed and treatments, cures and vaccines are having an impact, or the promise thereof. The US Presidential election has hit top gear for President Trump, who is sweeping across the ‘Battle-ground States’ and is gaining momentum! The polls show he is behind but the ‘Electoral System’ means he may well pull it out of the bag, in a repeat of 2016. This is a consequential election for the economy. Trump is advocating strongly for a highly deregulated low tax economy, while the Democrats want higher taxes and a huge new era of green tax and regulation.

Commodity currencies have taken advantage of an indolent reserve, with the AUD pushing up to 0.7140, while the NZD has broken back above 0.6700. Virus, Brexit and the US elections are set to dominate markets.

Collinson & Co Contact