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Our briefing for Friday, August 20, 2021:
Aug 20, 2021 3:32:03 PM
- In the United States, health officials are recommending that all Americans get booster shots. The World Health Organization (WHO) objected, citing concerns about developing countries not having enough supplies. Last week health officials recommended booster shots for those with suppressed immune systems, but the plan to extend boosters to all Americans could begin as early as Sept. 20. U.S. President Joe Biden defended the decision, saying that the extra doses are the best way to protect people from any new variants. "We have a responsibility to give the maximum amount of protection," Biden said at the White House.
- In Canada, an increasing number of employers are choosing to make vaccines mandatory. On Thursday evening, the Royal Bank of Canada said it will require employees to be fully vaccinated by Oct. 31, while the City of Toronto recently announced that it will require all of its employees to be fully vaccinated by Oct. 30. “The City of Toronto has a duty as an employer to do everything that it can to ensure that our work environment is safe for all of our employees,” Toronto Mayor John Tory said at a news conference Thursday. The Toronto Transit Commission (TTC) immediately followed, saying vaccines will be mandatory for all TTC employees and contractors as of Sept. 13.
- In the United Kingdom, a month has passed since England removed almost all of their Covid-19 restrictions, a move that was widely criticized by health experts and scientists. On July 19, they allowed venues like nightclubs to open at full capacity and removed almost all mask requirements. As of Monday they also removed the requirement for fully vaccinated people to quarantine when coming into contact with a Covid-19 case. Some experts are still criticizing the move to reopen, pointing at figures like the death toll which some say is still unnecessarily high.
- In Japan, Tokyo reported 5386 new cases on Wednesday, down slightly from its record of 5773 last Friday. As the Paralympics approach, officials continue to disagree over whether the Olympics had a significant impact on rising case numbers. Tokyo is currently under a state of emergency and will remain until the Paralympics are over. The current rules in place require restaurants and bars to close early and stop serving alcohol, but Japanese media reports that about 40% of them in some parts of Tokyo are ignoring the rules. About half of the population of Japan has received at least one dose of vaccine, while only about one third are fully vaccinated.
- New Zealand has extended their nationwide lockdown until next Tuesday as coronavirus cases spread from Auckland to Wellington. Total case numbers have now gone up to 31, with 19 of the cases linked to the first one, a 58-year-old man in Auckland. Prime Minister Jacinda Ardern acknowledged the challenges of lockdowns and urged citizens to stay vigilant. “I know we all want to block out the memory of 2020,” she said. “We have been here before. We know the elimination strategy works – cases rise, and then they fall. It’s tried and true. We just need to stick it out. Everyone, I mean everyone, needs to play their part.”
- In Australia, New South Wales reported 642 new cases, down slightly from 681 on Thursday. The government extended a lockdown in Sydney until the end of September and also imposed a curfew on Sydney’s worst-hit city suburbs. The curfew will run from 9:00 PM until 5:00 AM and is meant to stop the movement of young people, according to New South Wales Premier Gladys Berejiklian. "I apologise to the vast majority of people in those communities who are doing the right thing but for our health and safety moving forward we need to make these difficult decisions," Berejiklian said.
Covid-19 – Due Diligence And Asset Management
Stocks rise as investors eye lingering virus, Fed policy concerns
Brief: Stocks reversed overnight declines to trade higher Friday, as investors considered the latest batch of earnings and economic data and continued to contemplate the path forward for monetary policy. The S&P 500 rose, though the index was on track to post a weekly decline for the first time in three weeks. Both the Nasdaq and Dow also moved to the upside. Traders this week have watched a number of market concerns unfold, with infections related to the Delta variant continuing to climb and the Federal Reserve suggesting in its latest meeting minutes that officials believed the economy might recover enough by the end of the year to warrant a shift in their massive asset purchase program. New weekly jobless claims fell more than expected to a fresh pandemic-era low, signaling a notable step forward in the labor market's recovery.
Three More Canadian Banks Mandate Vaccines for Most Staff
Brief: Toronto-Dominion Bank, Canadian Imperial Bank of Commerce and Bank of Montreal joined other major financial firms in requiring staff to be fully vaccinated against Covid-19 before returning to the office. All employees of the Toronto-based TD will be asked to register their vaccination status by Sept. 30, according to a memo sent to staff Friday. As of Nov. 1, full vaccination will be required of TD employees working in all company locations globally, a spokesman said. “We believe that the majority of TD colleagues have already been vaccinated. This is great news,” Kenn Lalonde, chief human resources officer, said in the memo. “However, Covid-19 remains with us and the delta variant, which is far more contagious, is spreading in our communities, primarily to those who are unvaccinated.”
U.K. Budget Deficit Narrows to Almost Half of Pandemic Level
Brief: U.K. government borrowing in the first four months of the fiscal year was running at little more than half the level a year earlier as the economy returned to normality after months of restrictions.The budget deficit stood at 78 billion pounds ($106 billion) between April and July, the Office for National Statistics said Friday. That compares with 139.7 billion pounds in the same period of 2020, when the economy was under siege from the coronavirus pandemic. July alone saw the deficit narrow to just 10.4 billion pounds as self-employed workers made payments ahead of a tax deadline. The shortfall was smaller than economists forecast. Tax revenue surged by almost 16% from a year earlier, and spending fell 3.5%.
'Gains will be harder to come by' for US economy hit by Delta variant
Brief: On Thursday morning, we noted that challenges were emerging for the health of the economic expansion, mostly due to the still-raging COVID-19 pandemic. Those signs continued into the end of this week. After highlighting that at least two Wall Street firms had either cut or cautioned on their economic growth forecasts, the team at Goldman Sachs followed this week with a reduction in its third quarter gross domestic product (GDP) outlook. Goldman's economics team led by Jan Hatzius said in a note to clients third quarter growth should come in at an annualized rate of 5.5%, well below the 9% the firm was previously forecasting. The team at Oxford Economics also published its latest weekly recovery tracker, which showed a decline for the week ending Aug. 6. Nearly all of the index's components cooling off.
Investors expect post-pandemic recovery despite new Covid variants fears
Brief: Research from Barclays Smart Investor revealed that 63% of investors believe that pandemic-hit industries such as hospitality and travel will bounce back, even though two thirds named new coronavirus variants as their biggest concern for financial markets. The survey of 2,000 UK investors also revealed that 59% of respondents are worried about rising inflation, while half the respondents said they are concerned about a market bubble bursting by the end of the year. A tech bubble is of a particular concern, with 42% of respondents naming this as a worry. Despite these fears, however, 59% of investors revealed they are feeling optimistic about financial markets for the rest of the year, while 60% are confident the successful vaccine rollout will help markets.
