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Daily Archives: 11th November 2020

11th November 2020

🗞️ Readying for the next big leg higher

iTraxx Main

50.4bp, unchanged

iTraxx X-Over

293bp, +3bp

🇩🇪 10 Yr Bund

-0.51%, -2bp

iBoxx Corp IG

B+108bp, -1bp

iBoxx Corp HY

B+409bp, -1bp

🇺🇸 10 Yr US T-Bond

0.96%, unchanged

🇬🇧 FTSE 100

6,382, +86

🇩🇪 DAX

13,216, +53

🇺🇸 S&P 500

3,575, +30

Near term ‘V’ anticipated…

After the euphoria, now there is calm – and the need to take a sober look at the situation. It’s going to be bright for markets, we believe. The economic normalisation process – albeit if only back to pre-pandemic levels of activity will elicit a bullish investor response and risk asset valuations will rise, potentially quite significantly.

Obviously, Trump is still hopeful. But Biden will surely be inaugurated. We have news of a vaccine and that will be the predominant driver for the rest of this quarter’s performance. There’s been a little circumspection about the vaccine from some quarters, but the Pfizer/BioNGen effort will be added to by others. We should therefore be nearing the endgame of the constant lockdowns and find a floor and that is what the markets are cock-a-hoop about.

Growth will turbocharge off it but that doesn’t mean we have suddenly found the answer to all the macro ills that were blighting the landscape before the virus took hold.

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