Stocks mixed, bonds climb amid stimulus stalemate

Stocks were mixed as traders assessed prospects for fresh stimulus amid the mostintense negotiations since Election Day. The S&P 500 fell by 0.13% to 3,668.10 while Dow Jones was down 69.55 points (0.23%) to 29,999.26.

US jobless claims jump to three-month high amid new shutdowns

Applications for US unemployment benefits surged last week, topping estimates with the highest level since September, suggesting that widening business shutdowns to curb the pandemic are spurring fresh job losses. Initial jobless claims in regular state programs rose by 137,000 to 853,000 in the week ended Dec. 5, Labor Department data showed.

US inflation measure rose by more than forecast in November

A measure of prices paid by US consumers rose in November by more than forecast as costs of hotel stays, airfares and apparel jumped, though inflationary pressures elsewhere remained subdued as the pandemic continues to curb activity. The consumer price index rose 0.2% from the prior month after no change in October, Labor Department data showed.

ECB offers ultra-cheap long-term loans for longer than expected

The European Central Bank said it will offer new long-term loans to commercial banks, locking in ultra-cheap credit for longer than analysts had expected. The Frankfurtbased ECB will offer three additional rounds of the loans between June and December next year, according to a statement. The Governing Council decided to lengthen the period in which banks get extra incentives by 12 months to June 2022.

UK-Singapore sign free trade agreement to replace EU deal

The UK and Singapore signed a free trade agreement, under which companies from both countries will continue to enjoy the same benefits on about 17 billion pounds ($23 billion) worth of goods and services they receive under an existing EU-Singapore deal. The signing sustains the two nations’ trade relationship beyond the UK departure from the European single market. Singapore’s trade ministry in January had affirmed that the EU-Singapore Free Trade Agreement would apply to the UK during the Brexit transition period, which ends Dec. 31.

ADB sees shallower Asia slump amid better China, India prospects

Developing Asia’s economy will contract this year by less than previously estimated as it begins recovering from the coronavirus pandemic, according to the Asian Development Bank. The region’s gross domestic product will shrink 0.4% this year, an improvement from the 0.7% drop forecast in September, the ADB said. It kept the region’s growth projection at 6.8% for 2021.

Pandemic to push Philippine debt ratio to more than 50% of GDP

The Philippines expects its debt to rise to more than half of its economic output this year as the government increased borrowing to cope with the pandemic, the Bureau of the Treasury said. Government debt will likely spike to about 53% of gross domestic product in 2020 after dropping to a “decades low” level of 39.6% last year, the Treasury said in it’s annual fiscal risk assessment for the year ahead.

Oil emerges from Covid abyss with startling year-end turnaround

Oil in London climbed above US$50 a barrel for the first time since the pandemic ground the global economy to a halt in a remarkable rally that few predicted would happen this soon. Brent crude for February settlement gained US$1.39 to US$50.25 per barrel.

Source: Affin Hwang Research - 11 Dec 2020