Though other European countries have extended their lockdowns or imposed new restrictions in the last week or two, perhaps none have done it with as chilling words as Angela Merkel.
Extending Germany’s partial lockdown over the Easter period, Merkel stated that the country was in a ‘very serious’ situation, going as far to say that it is ‘basically in a new pandemic’ thanks to the new found dominance of the British variant.
And Britain should perhaps prepare itself for similar news. After all, yesterday Boris Johnson warned that we would feel the effects of the European third wave ‘in due course’.
If that wasn’t enough, a new administration in America has done little for relations between China and the West. The last few days have seen a spate of sanctions, first from the EU and UK, and then from the US and Canada, against senior officials involved in the gross mistreatment of Uighur Muslims in Xinjiang. In retaliation, China has slapped sanctions on several EU officials for ‘harming’ the country’s sovereignty.
The morning certainly had a whiff of 2020 about it, and though the European markets didn’t collapse after the bell, it was hard to shake the negativity that comes from being stuck in a loop of the same headlines for months on end.
The FTSE shrank below 6,700 as it fell 0.6%, despite GBP/USD also shedding 0.4% as it ducked under $1.381. This as the UK jobs report broadly disappointed. Though the unemployment rate covering the 3 months to January unexpectedly fell from 5.1% to 5.0%, the more recent data paints a less rosy picture, with February’s claimant count change number hitting 86,600 against the 9,000 forecast.
Interestingly the DAX’s losses weren’t any more pronounced than elsewhere, even when factoring in Merkel’s announcement. Sitting just below 14,600, the index’s 0.6% decline still means a record close to the week isn’t out of the question.
Echoing the losses seen in the UK and Germany, the French CAC was down 0.6%, sending it to a 13-day low of 5,930.
As for the US open, the Dow Jones is heading for a 0.3%, 100-point decline after the bell, one that would kick it back to 32,630.
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