Stocks slump on lockdown angst amid stimulus limbo

Stocks slumped and Treasuries rallied as a resurgence in coronavirus cases added to concern about tougher restrictions that could slow down the economic recovery without further stimulus. The S&P 500 fell by 1% to 3,537.01 while Dow Jones was down 317.46 points (1.08%) to 29,080.17.

Powell warns of US economy risk with pandemic at deadliest yet

Three of the world’s top central bankers warned that the prospect of a Covid-19 vaccine isn’t enough to put an end to the economic challenges created by the pandemic. “We do see the economy continuing on a solid path of recovery, but the main risk we see to that is clearly the further spread of the disease here in the United States,” Federal Reserve Chair Jerome Powell said.

US initial jobless claims decline by the most in five weeks

Applications for US state unemployment benefits fell by the most in five weeks, signaling the gradual recovery in the labor market is continuing despite a record surge in Covid-19 infections. Initial jobless claims in regular state programs totaled 709,000 in the week ended Nov. 7, down 48,000 from the prior week, Labor Department data showed. On an unadjusted basis, the figure decreased by about 21,000.

Boris Johnson seeks green jobs for UK as unemployment surges

Prime Minister Boris Johnson is seeking advice from industry on how to create green jobs in the UK as unemployment rose at the quickest pace in a decade. The government is gathering a green jobs taskforce that seeks to create employment for 2 million by 2030.

Germany projects higher tax revenue despite virus struggles

Germany raised its forecasts for tax revenue this year and next as the government’s efforts to contain the economic fallout from the coronavirus pandemic show signs of working. Chancellor Angela Merkel’s government raised its tax income estimate for 2020 by 10.6bn euros (US$12.5bn) from its September projection. The figure for next year rose 3.3bn euros to a total of 776.2bn euros.

China-anchored free-trade zone, world’s biggest, nearly done

Fifteen Asia-Pacific nations including China aim to clinch the world’s largest free-trade agreement this weekend, the culmination of Beijing’s decade-long quest for greater economic integration with a region that encompasses nearly a third of the global gross domestic product. The Regional Comprehensive Economic Partnership, which includes countries stretching from Japan to Australia and New Zealand, aims to reduce tariffs, strengthen supply chains with common rules of origin, and codify new ecommerce rules.

Indonesia pushes for Southeast Asia travel bubble in early 2021

Indonesia is pushing for a travel corridor arrangement for Southeast Asian countries to be in place in the first three months of 2021. President Joko Widodo said a declaration on the travel corridor will be issued during the ongoing Asean Summit. Indonesia proposed the move in June, when Thailand and Malaysia said they backed the move, while other countries haven’t signaled their support for the arrangement.

Oil drops after US stockpiles rise, Fed warns of covid risk

Oil dropped after an unexpected increase in US stockpiles and a Federal Reserve warning that a vaccine may not be enough to get the economy back on track. Brent crude for January settlement lost US$0.27 to US$43.53 per barrel.

Source: Affin Hwang Research - 13 Nov 2020