U.S. markets hit new highs

U.S. stocks record high

U.S. markets climbed to new highs Wednesday as the post pandemic upward momentum gained strength As the U.S. economy re-opens at break neck speed, financial rewards continue to flood the stock market. U.S.monetary and fiscal policy backed up with a tsunami of Fed ‘easy’ money have dramatically helped the economic recovery. But this has also fuelled inflationary fears, interest rate concerns and pushed debt to new all time highs. Have the markets now been over cooked? New highs The Nasdaq on Wednesday 22nd June 2021 reached a new all time…

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U.S. stock markets gain as jobs improve

Stock grind higher

Dow gains 570 points as Nasdaq starts recovery U.S. stocks quickly bounced back from a sharp sell-off on Friday, 5th March 2021as bond yields eased. A better than expected jobs report boosted sentiment too. The Dow Jones Industrial Average climbed 572 points, to 31,496 after losing 150 points in intraday trade. The S&P 500 ended the wild session 2% higher too at 3,842 after falling 1% earlier in the day. The Nasdaq advanced 1.6% to 12,920 after falling by 2.6% on the day. Quite a turn around. Bond yields retreat…

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Bond yields and stocks slug it out

Bond yields

Bond yields create fear factor The fears over falling bond prices that gripped the market last week receded on Monday, 1st March 2021, as European stocks and U.S. stock futures rose as bond yields fell. The surge in bond yields bashed equity markets last week, with the technology heavy Nasdaq losing some 5%. Rising yields make the relative valuation of stocks appear worse as yields move in the opposite direction to prices. Central banks Central banks will eventually most likely have to react if there is a sustained rise in…

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UK debt now exceeds 100% of GDP

UK GDP

UK borrowing surges to pay for Covid-19 impact The UK’s debt is now worth more than its economy after the government borrowed a record amount in May 2020. The £55.2 billion was nine times higher than in May 2019 and the highest since records began. The borrowing sent government debt to £1.95 trillion, exceeding the size of the economy for the first time in more than 50 years. The borrowing was necessary as the UK government battled against the affects of the pandemic and as an extensive array of spending…

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The Bank of England increases UK economic support by £100 billion

Quantitative Easing

More QE The Bank of England announced Thursday, 18th June 2020 more support by increasing QE – Quantitative Easing by injecting a further £100 billion into the UK economy. This increase brings the total to £745 billion. Bank policymakers voted 8-1 to increase the size of its bond-buying programme and said there was evidence that the UK economy would be impacted less than initially feared. The Bank said more recent indicators of economic activity suggested the economy was starting to bounce back. It was reported that there had been a…

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UK national debt soars

Historic debt level

Doom and gloom? The Organisation for Economic Co-operation and Development, (OECD), has warned that the effects of the pandemic will be far reaching and will likely hit the UK harder than other comparable major economies. As the OECD reports of a very slow and difficult recovery for the UK, we are also reminded that UK debt has now reached historic levels. The World Bank and the IMF have voiced their opinions about debt too. And not wishing to be left out of the doom and gloom discussion, the CBI inform…

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Global stocks continue to ride hope of pandemic recovery

Virus vs the Markets

Too fast too soon? Blind hope or sensible policy? Governments around the world attempt re-opening, but is it too early? Will we be hit with a second wave of the coronavirus? Hope is that the worst of the pandemic is behind us now. How can we know? What does the science say? According to the WHO, we should be very cautious and prepare for a second wave as infections are expected to spike. But for the moment, markets appear very happy with recovery hopes and of the recent vaccine news.…

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UK borrowing up, retail sales down

Borrowing

UK borrowing at record high as virus cost soars Government borrowing surged dramatically to £62 billion in April 2020 according to data released by the Office for National Statistics, was the highest monthly borrowing on record, as a result of substantial government intervention to help ease the coronavirus crisis. The deficit, that’s the difference between spending and tax income – was larger last month than forecast for the whole year at the time of the Budget. The data from the Office for National Statistics revealed the soaring cost of support,…

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Central bank stimulus can’t go on forever

Central bank

Money machines Central banks have been pumping money into their respective economies around the world. But it can’t go on forever, and at some point economies will have to learn to stand on their own two feet again. It won’t be easy. Coming out of lockdown Countries around the world are attempting to break lockdown measures put in place to spite the coronavirus. It’s going to be a tough journey. We don’t yet fully know just how much damage has been caused by these policies – and we fear a…

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Personal loans in UK up 14% in December 2019

Loans

Persoanal loans Personal borrowing through loans last month was 14% higher than in December 2018 according to data released by UK Finance. Credit cards Credit card spending climbed 7.3% over the year to £11.8 billion in December 2018. Borrowing on cards is currently growing at 2.4% a year. Residential mortgages Mortgage approvals in 2019 climbed 7.4% compared to the previous year according to UK Finance data, with December approvals up 24% compared to December 2018. However, residential mortgage lending fell 1.1% to £22.2 billion in December 2019, according to the…

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