It’s a time between hope and fear: the virus is a cause for concern as vaccine development sheds light on the horizon. The Brexit talks are also a hangover. The general mood is nevertheless positive. Investors prefer to look far into the future – beyond the crisis.
Despite the successes in developing a corona vaccine, investors should have turbulent weeks ahead of them. “Experience has shown that it is not so much the cold season as the pandemic fatigue that causes the number of cases to rise again,” say the experts at asset manager Western Asset Management. The current restrictions to contain the corona virus make sense, but they come at the cost of the economy.
Chris Beauchamp, chief market analyst at brokerage firm IG, points out that it will take some time for a vaccine to be approved and widely distributed. “This worries investors about how much the second wave will spread and how bad the situation will be over the winter.”
With this in mind, the stockbrokers are eagerly awaiting the Corona summit from the federal and state governments On Wednesday. The still rapidly growing number of infections is fueling the debate about further requirements for restaurants, schools or contact restrictions. According to Reuters from regional circles, it is currently very likely that, for example, the closure of restaurants will be extended and new requirements will be placed on schools. The retail trade should therefore remain open in the important pre-Christmas business.
Positive mood: what will the Brexit talks bring?
Overall, however, the mood is positive, says investment strategist Axel Botte from asset manager Ostrum. “The financial markets have obviously decided to ignore short-term risks and are already looking to the time after Corona.”
However, the most recent Dax rally lost momentum. The leading German index had only recorded a meager increase of 0.6 percent weekly. In the past two weeks he had gained just under five and eight percent.
Investors were also encouraged by media reports on progress in the EU Brexit negotiations. After years of tug-of-war, the UK and the EU could contractually determine their future relationship in the new week. However, Börsianer was nervous about the interruption of the talks due to a corona case in one of the delegations. According to the Finnish European Minister Tytti Tuppurainen, the talks are at a critical stage and the time pressure is enormous. Without an agreement, the introduction of tariffs at the end of the year threatens economic burdens for both sides.
Economic data at a glance
When it comes to economic data, investors turn to the US consumer spending on Wednesday. Consumer buying sentiment is seen as the mainstay of the world’s largest economy. A few hours later the US Federal Reserve the minutes of their last meeting. Stock traders expect to provide further evidence of Fed asset purchases expanding in December.
All in all, however, stockbrokers are expecting little impetus from Wall Street, which will remain closed for the Thanksgiving holiday on Thursday and close its doors on Friday noon. Many US investors take this opportunity for a short vacation.
This side of the Atlantic stands on Tuesday the Ifo-Index, which reflects the mood in the German executive suite, on the plan. A comparable barometer at European level will follow on Friday. The day before GfK-Index Information on the mood of German consumers.
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