The press conference delivered by Prime Minister Boris Johnson at the weekend announced plans for a phased reopening if we remain on the current downtrend of cases. The impact of this has been welcomed by the markets this week and these companies share prices bounced back strongly from their lows.
From the beginning of June outdoor markets and spacious car showrooms can open, as the government says that, as with garden centres, the risk of catching COVID-19 is lower outside where it is generally easier to apply social distancing.
From 15th June all other non-essential retailers, including shops selling clothes and indoor markets, can follow suit. This is a global trend with Japan poised to lift its nationwide state of emergency and gradually reopening the world’s third-biggest economy after new cases slowed to a crawl.
The relationship between the US and China has gone through a volatile period over the last few years following on from the Huawei spat, Hong Kong protests and of course the trade war which impacted global trade and stock markets in 2018. This year, the coronavirus has only added more fuel to that fire and as we emerge from this pandemic the tensions seem just as raw.
China has now gone as far as to state that its relations with the US were “on the brink of a new Cold War”. There are some signs that this is starting to bubble over. Police said they arrested at least 180 protesters on Sunday as thousands took to the streets of Hong Kong in a display of defiance against Beijing’s plans to impose a national security law.
Looking forward this week the focus will be on Europe. Today, the President of the European Commission, Chief Ursula von der Leyen, will propose a roughly €1-trillion post-virus recovery fund for Europe, but will have to win over sceptical member states.
The global coronavirus outbreak has thrust the EU into its deepest-ever recession, and Von der Leyen’s proposal will set out to help the worst affected countries. Italy and Spain were Europe’s first victims of the outbreak and, still burdened with heavy debts, lack the firepower of Germany and others to rebuild their shattered economies. The European Commission, the EU’s executive arm, has won the crucial backing of Germany and France to raise €500 billion on financial markets to begin to fix the problem.
Chief Investment Officer
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