The U.K. Stock market
- The UK stock-market was lower this week. European leaders reached an agreement on a €750 billion coronavirus recovery fund to support the most affected economies after almost five days of negotiations.
- Positive news on a potential coronavirus vaccine also helped early in the week but markets were set back subsequently following a deterioration in relations between the US and China.
- The latest round of Brexit negotiations concluded with EU’s chief negotiator, Michel Barnier, saying that the two sides are still divided on key issues although both sides told The Times that a comprehensive Brexit deal could be finalized in September
- UK retail sales were much stronger than expected in June, growing 13.9%, compared with the consensus estimate of 7.3%.
- Our Breadth Indicator turned negative but our Momentum Indicator ticked higher again.
The U.S. Stock market
- Early in the week markets were lifted by optimism over a potential coronavirus vaccine as German biotech firm BioNTech, US drugmaker Pfizer and Oxford-AstraZaneca reported positive results in early trials.
- However, later in the week US-China relations worsened which had markets on edge. The U.S. ordered the closure of the Chinese consulate in Houston to “protect Americans’ intellectual property and private information.” China retaliated by ordering the closure of the US consulate in the city of Chengdu.
- Losses towards the end of the week were compounded by a new rise in jobless claims with the number of Americans filing for unemployment benefits increasing 1.42 million in the week ended July 18th.
- Our Breadth indicator stayed positive this week as did our Momentum indicator.
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