Weekly Recap – Dec 4

Major economies overall are showing better numbers in the third quarter, but rising coronavirus cases and vaccine distribution obstacles continue to hamper economic growth.

Nonfarm Payrolls (NFP) in the US rose by 245,000 in November, the data. This reading followed October’s increase of 610,000 (revised from 638,000) and missed the market expectation of 469,000 by a wide margin.

This reading is the lowest employment gain since the job market has started to recover. In November.

The average hourly earnings of non-farm employees increased by 4 cents, to $ 29.50 in October 2020.

This is the same pace it recorded in September and below market expectations, with an increase of 0.2%.

German GDP rebounded in Q3, gaining 8.5% after a decline of 9.7% in Q2, while in France, the GDP rose by 18.7%, above expectations of 18.2%.

Canadian GDP, which published monthly, slowed to 0.8% in September. As for the job numbers, the economy created 62.1,000 jobs, over expectations of 22,000, and the unemployment rate fell to 8.5% from 9.05.

The Australian Reserve kept interest rates at a low of 0.10% with GDP gaining 3.3% in the third quarter, above expectations of 2.5%.

Economic activity in the manufacturing sector in the United States expanded during November, with the overall economy notching a seventh consecutive month of growth, according to Tuesday’s data by ISM.

The November Manufacturing Purchasing Managers’ Index (PMI) registered 57.5 percent, down 1.8% from the October reading of 59.3 percent.

Economic activity in the United States services sector grew in November for the sixth consecutive month.

The Services PMI registered 55.9%, declining by 0.7% compared to the October of 56.6%.

Chinese Caixin Services PMI rose to 57.8 in November from 56.8 in October, the second-highest reading since April 2010.

In testimony on Capitol Hill, Federal Reserve Chair Powell reiterated his message for further fiscal stimulus support from the federal government.

Stocks

Wall Street’s main indices rose to an all-time high on Friday, as data showed the slowest job growth in the United States in six months, raising investor expectations for a new financial aid package to support the coronavirus-hit economy.

The Dow Jones Industrial Average rose 248.74 points, equivalent to 0.83%, to 30,218.26 points, recording a weekly gain of more than 1%.

The index closed the S&P 500, up 32.40 points, or 0.88%, to 3,699 points, and has gained about 1.7% this week.

The Nasdaq Composite Index increased 87.05 points, or 0.7%, to 12464.23 points, the highest close in its history, to achieve 2.1% gains this week.

In Europe, the Stoxx Europe 600 index closed up 0.6%, or 2.3 points, to record weekly gains of 0.2%.

The British “FTSE 100” index also increased by more than 0.9% to 6,550 points, the German “DAX” rose by more than 0.3%, recording 13,299 points, and the French “CAC” rose by 0.6% to 5609 points.

Oil

In the oil market, the price of futures contracts for Brent crude for February delivery rose by 1.3%, equivalent to 63 cents, recording $ 49.25 a barrel, while it witnessed an increase of 2.1% this week.

Nymex futures contracts for January delivery rose 1.4%, or 62 cents, to record $ 46.26 a barrel, with a weekly gain of 1.6%.

Gold

The yellow metal reversed its upward trend, as gold contracts for February delivery ended the session, down 0.1% or $ 1.10, recording $ 1840 an ounce, but the metal achieved weekly gains of 2.9%.

Opec

Four OPEC+ sources told Reuters that OPEC and Russia agreed on Thursday to a modest increase in oil production from January by 500,000 barrels per day, but failed to find a solution for the rest of next year.

It was widely expected that OPEC and its allies, under what is known as OPEC+, would extend existing production cuts of 7.7 million barrels per day, or 8% of global supplies, until at least March 2021.

But after hopes of speedy approval of vaccines to prevent the virus resulting in a rise in oil prices at the end of November, several producers began to question the need to tighten oil policy, such Saudi Arabia, a prominent member of OPEC, supports.

Brexit

On Friday, a European Union official was quoted as saying that a trade deal with the United Kingdom was expected by the end of the weekend.

In a joint statement after their call, both Johnson and von der Leyen said they could not reach an agreement if differences over the three main issues of governance, fisheries and competition rules, known as equal opportunity, were not resolved.

“This is the last roll of the die,” said a British source close to the negotiations.

Covid-19

The numbers of Coronavirus cases in the United States continue to break records, as the country reported more than 217,000 infections on Thursday, and nearly 2.9,000 deaths, while hospitals continued to witness record highs.

Meanwhile, California announced that it will enforce stay-at-home orders in areas where the ICU is full. While Iowa has recorded a record number of daily deaths, New Jersey and Maine have reported the most cases since the pandemic began.

As for potential vaccine developments, Pfizer expects to ship half of the Covid-19 vaccine doses it originally planned for this year due to supply shortage.