As the US reaches 3 million covid-19 cases domestically, and Australia imposes a hard border between New South Wales and Victoria, investors couldn’t shake their re-lockdown concerns on Wednesday.
It’s not the case numbers and return to stricter measures in and of themselves that are bothering investors, but rather the dampening effect they will have on the chances of a swift and sturdy global economic recovery.
Europe’s losses were, however, kept to a minimum – for now, anyway. The DAX dipped 0.3%, knocking it under 12600, while a half a percent decline for the CAC took it below 5020.
The FTSE shed around 20 points, keeping it the wrong side of 6200, having crossed 6300 at the start of the week.
The UK index could have plenty more movement in it, given that today sees Chancellor Rishi Sunak’s summer statement, or ‘mini-budget’. Alongside the already-announced – or, rather, already-leaked – £1.57 billion arts package, there are reports detailing a whole host of different options Sunak could unveil.
These include £1000 bonuses and National Insurance cuts for firms taking on trainees aged 18-24, an emergency short-term VAT cut for the ailing high street, a swell of front line Jobcentre staff, a 6-month stamp duty pause, and even a £500 voucher for every adult in the country, to be spent on face-to-face retail.
What is actually announced could dictate where the FTSE ends the day, though the pound may well steal some of the index’s thunder. Sterling got a boost on Tuesday after it was revealed that David Frost and Michel Barnier were having dinner at No. 10 ahead of informal Brexit talks, but hasn’t done much as of yet this Wednesday.
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