As the week began, the stock markets reached new highs, however, they ended the week in the red. Undoubtedly the biggest reason for this climb was the news that the UK was beginning their vaccination plan and the USA approved the emergency use of the Pfizer/BioNTech vaccine. However, this positive mood of the market soon came crumbling down, mainly due to Thanksgiving Day, where a huge number of people traveled around the country, which probably caused a spike in the number of infections.
To worsen the situation, the American Government still hasn’t reached a decision on the stimulus package. Recently, both the Democratic and Republican leaders publicly said that a new fiscal stimulus package might not come before Christmas. This is something very unfortunate, considering the dire situation millions of people and businesses are currently facing.
Likewise, the European markets suffered, being the main cause of distress the Brexit issue. Even though there was a time limit for a deal, without any surprise, the date was once again delayed due to a lack of agreement. Ursula von der Leyen and Boris Johnson recently said there’s currently a higher chance of a no-deal Brexit than there was before.
The European situation declined, even more, this week. Many European countries are facing a second wave of COVID-19 in full force, and most countries had to enforce even stricter quarantine measures.
On a more positive note, the European Union was finally able to approve a historically big budget after surpassing the voting problem caused by Hungary and Poland. The ECB also raised the existing fiscal measures by 500 billion euros and agreed to provide banks with extremely cheap lines of credit.
In Japan the pandemic is showing itself in the rise of infections, reaching new daily highs for consecutive days. This compelled Japan’s government into action and did so by applying more restrictive measures, which in turn will cause some damage to the economy. In line with those measures, Prime Minister Yoshihide Suga announced a third economic package that will be applied in several sectors of the economy, in hopes that it creates some growth.
Currently, China is facing a delicate situation, to say the least, being sanctions from the American government their biggest issue. Especially because the S&P500 and Dow Jones index announced this week that they will be removing 21 Chinese companies from their indexes.
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