News about Donald Trump’s COVID-19 disease has made adjustments to the market situation. To be more precise, they further increased the presidential election result’s uncertainty and brought more chaos in the US political life.
On Monday, markets reacted to the US president’s sickness with the growth of stock indices in Asia and a positive open if the trading session in Europe. Unfortunately, this does not mean anything yet because any news that Trump’s condition worsens or his recovery may take longer will increase the uncertainty and lead to a collapse in the stock markets.
The main events of the coming week
This week the market will focus on the publication of production data from China, the US, UK, France, Germany and the Eurozone. The volumes of exports, imports, and trade balances of Germany, France, and the United States and the number of open vacancies in the US JOLTS labor market will be announced.
The volume of exports and imports of China and the data of the last Fed meeting on monetary policy are also expected today.
On Thursday, the ECB will hold a monetary policy meeting, which will be the week’s major event for the European market, so we expect the European stock indices’ to continue its sideways dynamics. On Thursday, we will also pay attention to data on the number of applications for unemployment benefits for the last week in the US. We expect the monthly GDP output and the figures for industrial production and the trade balance from the UK statistics.
But again, let me draw your attention to the fact that Donald Trump’s state of health and the course of his illness will be in the top news and the main focus of the market.
Thoughts and conclusions:
In the coming week, the main focus of investors’ attention will be Trump’s health state and how his treatment will proceed. President’s doctors’ statements will play an important role. Suppose they indicate that the illness is mild. In that case, investors’ attention will switch to the emerging data of economic statistics and the prospects for renewed debate between him and Joe Biden.