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Global equity markets have renewed their upward momentum this week after last week’s social media frenzy-induced volatility dissipated and allowed markets to focus again on Joe Biden’s fiscal stimulus plans and the global economic recovery.
It has been a tough start to the week for global equity markets given some US senators appear reluctant to pass Joe Biden’s $1.9tr fiscal stimulus package, coupled with the slow vaccine roll-out across Europe.
We have had a lacklustre start to the week thanks to the US markets being closed on Monday (18 January 2021) for Martin Luther King Jr. Day, coupled with Joe Biden’s inauguration as President today – although an inauguration isn’t normally a market moving event, given the potential for protests across America, it is getting a lot more attention than usual.
As it has been a quiet week so far on the economic data front, we thought we would address the issue which has recently appeared in many of the business pages of the press: are equity markets in a bubble that is about to burst?
In the words of the Von Trapp children in the Sound of Music, “So long, farewell, auf Wiedersehen, goodbye.”
Not only have global equity markets started the year in an exuberant mood, but the FTSE-100 has literally leapt out of the starter gates this week (as we write, the FTSE-100 is up just over 3% today, taking its gain so far this week to 5.50%).
Given the lack of any significant economic data releases so far this week, global equity markets have been fairly muted and remain hostage to the tug of war between vaccine optimism and further stimulus versus the growing number of coronavirus cases that is still being fought.
It’s been a volatile week for equity markets, as they continue to take two steps forward and one step back, as world leaders race to reach agreements, on stimulus and post Brexit trade relations.
Although November ended on a downer as the FTSE-100 fell just over 100 points (nearly 1.6%) on Monday (30 November 2020), overall November delivered some fantastic equity market rallies: the FTSE-100 rose 12.35%, while in the US the Dow Jones climbed 11.84% and Japan’s Topix ended the month 11.12% higher.
The equity market theme so far this week has been the same as the last few weeks.
Many people are already paying 5% of their salary into their workplace pension through auto-enrolment, with their employer contributing an additional 3%. However, they may not be aware that many employers are willing to match additional contributions up to certain limits, so they don’t take advantage of it.
13th April 2021
Latest reports from The Office for National Statistics have indicated that in February 2021, the number of payroll employees had fallen by 693,000 over a 12 month period.
25th March 2021
3rd March 2021
As we highlighted in the Weekly Market Summary, the markets’ attention at the start of this week was firmly on yesterday’s (Tuesday 13 April 2021) US CPI inflation reading following last week’s large jump in US PPI inflation.
14th April 2021
As we speculated in the Weekly Market Summary, the reaction to last Friday’s stunning US employment data has been positive with most of the major equity markets showing gains on the week (with equity markets closed on Friday and Monday for Easter, we had to wait until Tuesday to see how the market would react).
9th April 2021
Although it is a shortened week thanks to the Easter holiday, it has already been filled with action – and we can expect plenty more as the week goes on.
1st April 2021
