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LGT Navigator: Daily Covid cases in China break record

November 25, 2022

Covid cases reached a high in China, breaking a record from mid-April and unsettling some investors who had hoped that the world’s second-largest economy would soon be reopened completely. Outbreaks were spread across the country, including in the southern industrial epicenter of Guangzhou. Stricter measures such as mandatory testing, quarantine and lockdowns, particularly in industrial hot spots, could wreck global supply chains and affect other economies.

Daily Covid cases in China break record

In New York, no trading took place Thursday due to the Thanksgiving holiday. Friday’s session will have shortened trading hours.

In Asia, stock markets were trading mostly lower, pressured by the Covid outbreak in China and core consumer prices in Japan’s capital that rose at their fastest pace in 4 decades this month at +3.6% on the year. Japan’s Nikkei 225 was trading -0.34% lower after the release of the data on Friday. Hong Kong’s Hang Seng index was trading down -0.86%, while in mainland China, the Shanghai Composite +0.4%. 

German business sentiment improves

Germany’s Ifo Business Climate Index came in Thursday at 86.3, an improvement on the previous reading. The survey data shows that the downturn in the German economy may prove to be less severe than many market participants had expected. However, uncertainty continued to increase in energy-intensive industries, according to the Ifo Institute, which conducts the monthly survey of businesses.

ECB officials show concern about inflation becoming persistent

Policymakers at the European Central Bank fear that the high inflation trend in the euro zone may be becoming entrenched and difficult to stop. Notes from the ECB’s last policy meeting in October, which were released Thursday, show the central bankers are also pushing to reduce the bank’s balance sheet, which has ballooned over the last decade mostly due to government bond purchases. Policymakers at the meeting thought it was clear rates would have to be increased further to rein in inflation, with a large majority supporting another 75-basis-point move.


Economic Indicators November 25

CET Country Indicator Last period
00:30 JP Tokyo Core Consumer Price Index (November, y/y) +3.4%
08:00 GE Gross domestic product (Q3, q/q) +0.3%
08:30 CH Labour force (Q3) 5.316m

Earnings Calender November 25

Country Company Period
GE Commerzbank (economic outlook with chief economist)
GE Thyssenkrupp (Capital Markets Day)  


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