- There was strength early in the week on further positive coronavirus vaccine news with the FTSE 100 closing at its highest level since June. Signs of progress in Brexit negotiations and strong economic data from China and Japan also helped sentiment.
- Markets stalled on Tuesday as vaccine optimism faded a little and Christine Lagarde, President of the ECB said she was “not sure that it’s going to be a major game changer for our forecasts”.
- Brexit talks continue, albeit remotely, after one of the EU team tested positive for Covid-19. There has been increasing hope that a deal can be agreed within the next few days but there were calls from some countries urging the EU to increase planning for a no-deal Brexit in case current negotiations do not result in agreement.
- Our Breadth Indicator stayed positive and our Momentum Indicator turned back to positive this week.
- Biotech firm Moderna announced that its experimental vaccine is more than 94% effective in preventing COVID-19. Following the Pfizer/BioNTech announcement the previous week this was another indication that an effective coronavirus vaccine may be available soon.
- On Tuesday, Jerome Powell, US Federal Reserve Chair, tempered the market’s enthusiasm saying the economy had a “long way to go”.
- Markets received a lift later in the week on reports that Mitch McConnell, Senate Majority Leader, had agreed to resume negotiations regarding the coronavirus stimulus bill, but surrendered the gains by close on Friday.
- Our Breadth Indicator stayed positive but our Momentum Indicator ticked back down.
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