US President Donald Trump is still lagging behind in the current polls of various institutes. In a few decisive swing states, however, the lead is marginal, so it seems uncertain whether the race will actually be decided in the night to Wednesday. After five appearances on Sunday, Trump wants to fight for votes today in three particularly contested states. His Democratic challenger Joe Biden, on the other hand, seems to be concentrating on the possibly decisive state of Pennsylvania. Trump, meanwhile, called for a decision on election night (probably with a view to possible uncounted mail votes).
On Wall Street, the Dow Jones Industrial fell by around -2% at times on Friday, but then managed to stem the losses until the close of trading, closing -0.59% lower at 26 501.60 points. Over the week, this resulted in a minus of -6.5% - the strongest weekly loss since March. The S&P 500 ended last week with a daily loss of -1.21% at 3 269.96 points. Due to quarterly reports and the outlook for some major tech stocks, which investors perceived as disappointing, the Nasdaq 100 fell by -2.62% to 11 052.95 points on Friday, thus losing -5.5% on a weekly basis. The losses were even greater last week in Europe. Against the backdrop of the lockdown imposed in many European countries due to the rapidly increasing corona case numbers, the benchmark index EuroStoxx 50 lost almost -8% on a weekly basis.
On the Asian stock exchanges, solid economic data from China provided support. The Purchasing Managers' Index for the Chinese industrial sector rose for the sixth consecutive month and, at 53.6 points in October, was well above the growth threshold of 50 points.
Meanwhile, oil prices fell to their lowest level in five months in view of the economic burdens caused by the new corona containment measures in Europe.
Shortly before the elections on Tuesday, which are decisive for the future of the world's largest economy, the mood of the Americans brightened up again somewhat in October. The consumer confidence barometer climbs in the final version from 80.4 points in the previous month to 81.8 points the best level since March. The University of Michigan commented that the effects of the corona crisis and extreme politicization will continue for a long time after the elections, with the potential to permanently change the economic and political landscape. The index for expectations improved from 75.6 (first evaluation 78.8) to 79.2 and the index for the assessment of the current situation fell from 87.6 (84.9) to 85.9 points. Meanwhile, consumer spending was stronger than expected, rising for the fifth consecutive month in September in the US. Compared with the previous month, spending rose by +1.4% (consensus +1.0%).
In the eurozone, the economy recovered from the corona shock in the third quarter, posting record quarter-on-quarter growth of +12.7%. Analysts had expected a much smaller recovery of +9.6%. In the second quarter, gross domestic product had slumped by -11.8% due to the corona crisis. The four largest economies in the euro zone recorded historic growth rates and exceeded market expectations. Germany: +8.2% (consensus +7.3%, Q2 -9.7%), France: +18.2% (consensus +15.0%, Q2 -13.7%), Italy: +16.1% (consensus +11.1%, Q2 -13.0%), Spain: +16.7% (consensus +13.5%, Q2 -17.8%). The question now is how much the new measures to contain the pandemic will weigh on the economies in the final quarter.
Consumer prices in the euro area remained in negative territory in October as well. As in the previous month, prices fell by -0.3% compared with the equivalent period in the previous year. In the core rate, i.e. excluding energy and food prices, which are often susceptible to fluctuations, the inflation rate remained just positive at +0.2%. The European Central Bank (ECB) thus missed its inflation target by a wide margin, but according to ECB boss Christine Lagarde it is confident that inflation will turn positive again in 2021.
|09:15||SP||IHS Markit PMI Manufacturing (October final)||50.8|
|09:30||SZ||IHS Markit PMI Manufacturing (October final)||53.1|
|09:45||IT||IHS Markit PMI Manufacturing (October final)||53.2|
|09:50||FR||IHS Markit PMI Manufacturing (October final)||51.0|
|09:55||GE||IHS Markit PMI Manufacturing (October final)||58.0|
|10:00||EZ||IHS Markit PMI Manufacturing (October final)||54.4|
|15:45||US||IHS Markit PMI Manufacturing (October final)||53.3|
|16:00||US||ISM PMI Manufacturing (October)||55.4|
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Source: LGT Bank (Switzerland) Ltd.
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