(20 MAY 2020)DAILY MARKET BRIEF 1:Mixed news outflow maintain investors cautious
The lack of positive catalysts finally seems to get the final word following the impressive bullish rebound seen on Monday globally. Hopes
from a Franco-German duo cooperation for the backing of a European Recovery Fund worth EUR 500 billion came into question because of the
timing of implementation (not available before 2021 earliest) while the “granted” condition rather than a proper loan should weigh on
support of all EU members on European Commission meeting from 27 May meeting. Yet signals of a united Europe should give positive signals and
boost sentiment as well as the single currency at some point amid risks of mounting anti-EU rhetoric due to worst economic contraction faced
by the Union since World War II. Expectations of a rapid vaccine release also dampened, after a report stating there was insufficient data to
confirm Moderna’s vaccine effectiveness (although that remains less surprising as the Cambridge-based biotech company just entered
phase 2 trial). For now, investors will be watching the Fed's upcoming minutes and trying to guess whether the Bank of England will apply
negative interest rates following its policy meeting on 18 June 2020.
By Vincent Mivelaz
