{"id":1958,"date":"2020-05-07T10:18:13","date_gmt":"2020-05-07T10:18:13","guid":{"rendered":"http:\/\/www.wealthatwork.co.uk\/jpm\/?p=1958"},"modified":"2020-11-18T10:40:49","modified_gmt":"2020-11-18T10:40:49","slug":"market-update-7th-may-2020","status":"publish","type":"post","link":"https:\/\/www2.wealthatwork.co.uk\/jpm\/2020\/05\/07\/market-update-7th-may-2020\/","title":{"rendered":"Market Update \u2013 7th May 2020"},"content":{"rendered":"<div class=\"wpb-content-wrapper\"><div class=\"vc_row wpb_row vc_row-fluid\">\n<div class=\"wpb_column vc_column_container vc_col-sm-12\">\n<div class=\"vc_column-inner \">\n<div class=\"wpb_wrapper\">\n<div class=\"wpb_raw_code wpb_content_element wpb_raw_html\">\n<div class=\"wpb_wrapper\"><iframe loading=\"lazy\" src=\"https:\/\/www.youtube.com\/embed\/sEVqxftGTQs?rel=0&amp;wmode=transparent\" width=\"560\" height=\"315\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\" data-mce-fragment=\"1\"><\/iframe><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"vc_row wpb_row vc_row-fluid\">\n<div class=\"wpb_column vc_column_container vc_col-sm-12\">\n<div class=\"vc_column-inner \">\n<div class=\"wpb_wrapper\">\n<div class=\"wpb_text_column wpb_content_element \">\n<div class=\"wpb_wrapper\">\n<p>This morning\u2019s attention has all been on the BoE.<\/p>\n<p>Although the decision by the BoE policymakers to leave interest rates unchanged at 0.1% was fully expected, it was their economic forecasts that stole the show.<\/p>\n<p>While the BoE expects UK unemployment to jump to 8% and business investment to drop by 26% as the UK economy shrinks by 14% this year, they expect the economy will bounce back strongly next year with the economy expanding by 15%.<\/p>\n<p>This is a relief as it confirms that we are not alone in expecting a sharp and painful, but short, downturn followed by a sharp acceleration on the other side of this horrible coronavirus outbreak:\u00a0 a V-shaped economy recovery \u2013 and hence why we have been saying that it is best to focus on the likely duration of the economic decline rather than the depth (please see\u00a0<a href=\"https:\/\/www2.wealthatwork.co.uk\/mywealth\/2020\/04\/27\/week-ending-24th-april-2020\/\">here<\/a>).<\/p>\n<p>Additionally, two of the 9 BoE policymakers voted to increase the size of the central bank\u2019s QE program.\u00a0 So, while it is therefore being maintained at the current level of \u00a3645bn, it suggests to us that policymakers are potentially open to the idea of increasing the size in the coming months, which will coincide nicely with the UK government\u2019s expected increase in gilt issuance!\u00a0 Hopefully we will get some more information at today\u2019s BoE press conference.<\/p>\n<p>The market has taken this announcement positively and as we write, the FTSE-100 is currently up just over 0.5%, or 30 points.<\/p>\n<p>Outside of the UK, the Japanese stock market reopened after three days of public holiday.\u00a0 The Topix index ended the day down 0.32%, while the Nikkei 225 was up 0.28%.<\/p>\n<p>In addition to the BoE press conference, our attention today will be on the weekly US payroll data.\u00a0 And although tomorrow is a bank holiday here in the UK, other markets are open.\u00a0 Consequently, we will be closely watching the market\u2019s reaction to tomorrow\u2019s US employment data, which covers non-farm payrolls, the unemployment rate, average hourly earnings and the participation rate \u2013 and any \u2018not-so-bad\u2019 numbers are likely to be taken positively.<\/p>\n<p><strong>Investment Management Team<\/strong><\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n  <\/div> ","protected":false},"excerpt":{"rendered":"<p>This morning\u2019s attention has all been on the BoE. Although the decision by the BoE policymakers to leave interest rates unchanged at 0.1% was fully expected, [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9],"tags":[],"_links":{"self":[{"href":"https:\/\/www2.wealthatwork.co.uk\/jpm\/wp-json\/wp\/v2\/posts\/1958"}],"collection":[{"href":"https:\/\/www2.wealthatwork.co.uk\/jpm\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www2.wealthatwork.co.uk\/jpm\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www2.wealthatwork.co.uk\/jpm\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www2.wealthatwork.co.uk\/jpm\/wp-json\/wp\/v2\/comments?post=1958"}],"version-history":[{"count":2,"href":"https:\/\/www2.wealthatwork.co.uk\/jpm\/wp-json\/wp\/v2\/posts\/1958\/revisions"}],"predecessor-version":[{"id":2189,"href":"https:\/\/www2.wealthatwork.co.uk\/jpm\/wp-json\/wp\/v2\/posts\/1958\/revisions\/2189"}],"wp:attachment":[{"href":"https:\/\/www2.wealthatwork.co.uk\/jpm\/wp-json\/wp\/v2\/media?parent=1958"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www2.wealthatwork.co.uk\/jpm\/wp-json\/wp\/v2\/categories?post=1958"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www2.wealthatwork.co.uk\/jpm\/wp-json\/wp\/v2\/tags?post=1958"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}