It is becoming increasingly clear that high infection rates across Europe are now translating into a rise in hospital admissions, as well as a higher number of deaths, with the UK and France registering the highest death rates since May as the second wave of the Coronavirus continued to spread in All over Europe.
Concerns about the second national lockdown in France are also growing Before a national speech scheduled for later this evening by French President Emmanuel Macron. In Germany, it was also reported that Chancellor Merkel is proposing to close bars and restaurants for one month, in a move that could last longer as the weather cools.
When stock markets fell sharply in February, governments in Europe, the US, and the UK increased massive financial support, and worked alongside central banks to support their economies. This, in turn, led to a strong recovery in the stock markets as confidence that politicians would support companies during what was likely to be a very difficult period helped fuel the recovery in sentiment.
It is not immediately clear that this financial support will be just as important the second time of demand, hence the steep slumps that we are now seeing in the equity markets.
First, with the US elections just one week close, there does not seem to be any political will to present a new financial package before the end of the first quarter of next year. As for the European Union, they did not sign even their first much-needed financial package from Italy and Spain, let alone a new package.
The picture here in the UK is no less clear With the UK government’s response that resembles a kind of economic hockey one step, one stepBy the end of the holiday, this led to a number of shifts as the economic outlook worsened.