Yet again it was a case of strong rallies on stock markets despite dire warnings on the COVID-19 outbreak as it continues to cause havoc across the world. On Monday the World Health Organisation stated that the virus was growing faster than ever. The warning comes as the US fights to regain control of the virus, and the UK and Europe look to catch any flare ups quickly.
Yesterday also saw Jerome Powell yet again go against the feelings of the White House and state that there was still huge uncertainty about the state of the economic recovery. Treasury secretary Steve Mnuchin has stated over the last week that the recovery at the end of 2020 would be huge seeing the economy rebound completely. Powell will speak again on Tuesday on the economy before the release of the FOMC meeting minutes on Wednesday.
Tuesday will see the last trading session of Q2 which has seen an enormous amount of volatility. The economic data that has been released for Q1 has received a rather muted reaction from markets, but that is likely to change as we start to get the data for the Q2 which was spent almost totally within lockdown.
Today sees the release of Q1 UK GDP which again shouldn’t cause much of a stir. Expectations are for the final reading to show a contraction of -1.6% however this will pale into insignificance with Q2 readings expected to show a -15% contraction.
Stocks in Asia have also gained after Chinese manufacturing PMI’s posted a reading above 50 for the first time. The 50.9 reading shows that the manufacturing industry is expanding for the first time since the start of the Coronavirus pandemic.
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