The U.K. Stock market
- The U.K. stock-market was higher this week. Prime Minister Boris Johnson announced a phased exit from lockdown measures with more details expected soon. The Dept. of Health said coronavirus deaths had exceeded 30,000 in the U.K., the worst in Europe.
- The Bank of England predicted that GDP would slump 14% this year but rebound 15% next year with Governor Andrew Bailey saying the BofE could act again if needed.
- The European Commission forecasted a sharp recession saying the eurozone economy will likely contract by a record 7.75% in 2020.
- Despite the negatives stock-markets finished higher on the week on positive news regarding the U.S./China trade negotiations and optimism over the lifting of lockdown restrictions.
- Both our Breadth indicator and our Momentum indicator stayed negative this week.
The U.S. Stock market
- The U.S. stock-market was higher this week despite data which showed a record contraction in April for both the manufacturing and services sectors, and jobs data which showed another 3.2 million had filed for unemployment insurance in the previous week.
- Investors responded positively however to encouraging news surrounding a potential coronavirus treatment and reports that the U.S. and China trade negotiators were expected to meet soon and resume work on the trade agreement.
- The week finished on a strong note with technology out-performing.
- Our Breadth indicator stayed negative this week but our Momentum indicator, although still negative, ticked higher for the first time in twelve weeks.
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