Stocks extend slide amid lingering virus concern

US stocks fell for a third day as optimism over a Covid-19 relief bill was tempered by the emergence of a new variant of the virus and a slew of lockdowns and travel curbs to contain it. The dollar advanced and Treasuries gained. The S&P 500 fell by 0.21% to 3,687.26 while Dow Jones was down 200.94 points (0.67%) to 30,015.51.

EU calls on member states to reopen transport links to UK

The European Commission called on member states to reopen critical trade and passenger transport links to the UK while discouraging non-essential travel, a step toward ending the chaos at Britain’s busiest port. The Brussels-based commission said in a statement that freight transport to and from the UK must be allowed to continue uninterrupted but that any unnecessary journeys should be avoided “until further notice.”

EU rebuffs Boris Johnson’s latest Brexit concession on fish

The European Union rebuffed Prime Minister Boris Johnson’s latest concessions on fishing rights, dealing a setback to efforts to secure a post-Brexit trade deal. Johnson spoke with Commission President Ursula von der Leyen twice to try and break the deadlocked negotiations. The UK put forward a proposal that would see value of the fish EU boats catch in British waters shrink by 30%, a substantially smaller drop than the 60% it was demanding last week.

UK deficit hits US$323 billion with economy facing recession

UK government borrowing climbed to a record 240.9 billion pounds (US$323 billion) in the first eight months of the fiscal year, reflecting the damage inflicted on an economy now at risk of falling back into recession. In November alone, spending exceeded tax revenue by 31.6 billion pounds amid the escalating cost of supporting firms and households through the pandemic, Office for National Statistics figures showed.

Swedish confidence drops as economy grapples with virus surge

Swedish overall confidence levels ended a seven-month climb in December, as the Nordic region’s largest economy tightened restrictions to battle a severe surge in Covid-19 infections. The overall economic tendency survey fell to 95.6, from a revised 97.2 in November, with the drop “largely a result of firms being less positive about the current situation,” the National Institute of Economic Research said.

India economy stabilizes in November as retail demand improves’

India’s economic activity showed signs of stabilizing in November, even as concerns of fresh virus outbreaks and a new strain in the UK mount amid news of vaccines fueling hope. All eight high-frequency indicators were steady last month, keeping the needle on a dial measuring the so-called ‘Animal Spirits’ unchanged at 5.

Philippines may keep interest rate low through 2022, Diokno says

Philippine central bank Governor Benjamin Diokno said the monetary easing cycle isn’t over and that he wants to keep interest rates low through the end of 2022. Even after cutting its benchmark interest rate by 200 basis points this year as the country grapples with a deep recession and one of Asia’s worst coronavirus outbreaks, Bangko Sentral ng Pilipinas still has “some monetary space” available, Diokno said.

Oil slips with new coronavirus strain threatening fuel demand

Oil declined to the lowest in a week amid expectations that a new spreading coronavirus variant and related travel curbs will weaken global fuel consumption already under pressure. Brent crude for February settlement fell US$0.83 to US$50.08 per barrel.

Source: Affin Hwang Research - 23 Dec 2020