According to data collected by the John Hopkins University, the number of daily cases – which had been hovering around 20,000 recently – has since the end of last week exceeded 30,000 cases per day. A peak was even reached on Tuesday at 34,000 new cases. This “unacceptable” spread, according to the governor of Texas (Greg Abbott), is pushing many states to consider imposing new restrictions. North Carolina has ordered all residents to wear masks, New York has postponed the reopening of shopping malls … Companies have also made individual decisions, like Apple which closed some stores in several states or Walt Disney which has postponed the reopening of its parks.
Financial markets are down again today after yesterday’s drop, when even the Nasdaq gave up 2%. Is this a pretext for short-term profit taking or a lasting threat to markets?
This relapse coincides with the publication in the United States of a new USTR document concerning proposals for taxing imported European products. At a time when governments are lining up hundreds of billions to rescue their economies, certain sectors and even individual companies, it looks like bad timing.
Last October, customs duties were imposed on USD 7.5 billion worth of goods from Europe. But the United States has identified an additional USD 3.1 billion of goods that could be taxed, after a consultation period that will end on July 26. These are mainly foodstuffs such as chocolate, coffee, vodka, beer…
With a timid recovery of the economy, the IMF is less and less optimistic about the evolution of global growth, pushing the organization to review its copy. Whereas in April, IMF economists expected the world economy to contract by 3%, their expectations are now -4.9%. The recovery outlook for 2021 has been lowered by 40 basis points to 5.4% and the IMF also stressed that many uncertainties remain. The outlook for 2021 has therefore become more and more bleak.
Today on the agenda, we have durable goods orders, the final reading of GDP, the trade balance and wholesalers’ inventories, which will be followed by the results of the Fed’s bank stress tests.
