Christmas market round-up: Good riddance to 2020

Garry White, Chief Investment Commentator, provides a round-up of the market movements and the global investing outlook over the Christmas 2020 break.

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  1. Garry White

Despite a world-wide health crisis that shut down huge swathes of the economy, the requirement of governments to spend billions of pounds on workers’ wages so unemployment figures didn’t soar – and a lack of clarity on when we will get back to some form of normality – global stock markets soared in 2020.

Wall Street tabled the most impressive gains – with the tech-heavy Nasdaq up more than 40% and the wider S&P 500 up about 15% over the year. The MSCI World Index, which tracks a basket of developed-market equities, also hit a new all-time high in December. However, the recovery in the FTSE 100 was pedestrian, due to its weighting in troubled sectors such as oil, banks and airlines. Britain’s blue-chip index fell about 14% in 2020. This is its worst performance since 2008, the peak of the global credit crisis.

Patience required on the path to recovery, argued Garry White. Although we hopefully have all the tools we need to deal with the pandemic in 2021, but investors need to prepare for rising unemployment, corporate insolvencies and loan defaults. Read his view here.


The holidays brought more upbeat news from the world’s scientists. The Oxford University-AstraZeneca vaccine was approved for use in the UK, with the first doses due to be given on 4 January. Priority groups for immunisation have already been identified, starting with care home residents, the over-80s, and health and care workers. The UK has ordered 100 million doses of the new vaccine – enough to vaccinate 50 million people. The US said it probably won’t approve this vaccine until April, although a German government spokesman said the European Union was likely to grant the vaccine a rapid approval.

However, millions more people in England were placed in Tier 4 restrictions. The Midlands, North East, parts of the North West and parts of the South West are among those escalated to tier four. Secondary schools across most of England are to remain closed for an extra two weeks for most pupils. The public must "redouble" its efforts at this "critical moment", Prime Minister Boris Johnson said, before adding he was confident things will be "very much better" by 5 April.

The leading US infectious disease specialist, Dr Anthony Fauci, predicted America would achieve enough collective Covid-19 immunity through vaccinations to regain "some semblance of normality" by autumn 2021.

China approved a Covid-19 vaccine developed by an affiliate of state-backed pharmaceutical giant Sinopharm, its first approved inoculation for general public use.

The pandemic delivered a body blow to global trade, with export volumes dropping abruptly to their lowest in nearly a decade in March and April. The recovery since then has been led largely by China, which stands alone among major economies in seeing year-over-year growth in exports. It is also expected to see GDP growth of about 4% in 2020.


Almost three-and-a-half years after the vote on membership of the European Union, Britain’s transition period ends at 11pm London time on New Year’s Eve.

After what seemed like interminable negotiations, a Christmas Eve trade deal to smooth out the worst disruption was agreed. The eleventh-hour deal warned of the prospect of a cliff's-edge separation that would have seen quotas and tariffs introduced on all cross-Channel trade, exacerbating strains on supply chains in the middle of the Covid-19 pandemic.

To ratify the agreement, the government introduced an 85-page bill to implement the pact, Boris Johnson told the House of Commons that it heralded a new chapter for Britain and the EU as "sovereign equals, joined by friendship, commerce, history, interests and values."

European Commission President Ursula von der Leyen quoted both William Shakespeare and TS Eliot. “Parting is such sweet sorrow," she said. “What we call the beginning is often the end. And to make an end is to make a beginning.”

Central banks

It is expected that the leading central banks will continue with their generous expansions of money supply and substantial buying of government debt in 2021 to keep interest rates very low. We look at the likely scope of monetary and fiscal policies next year here.


US politics is now all about the state of Georgia. The first week of January will see a high-stakes Senate runoff election. The two races will decide which party controls the upper chamber of Congress during the first years of the Biden administration – and how much of the Democrat agenda they will manage to push through Capitol Hill.  As no candidate attained 50% of the vote on 3 November, both races are being run again on 5 January.

Despite dozens of lawsuits brought by Donald Trump’s campaign to overturn the presidential election, no credible evidence was produced of widespread voter fraud.

The US will impose new import taxes on some French and German goods as part of a long-running trade dispute over subsidies for aircraft manufacturers. Washington announced tariffs on aircraft manufacturing parts along with certain non-sparkling wine, cognac and other grape brandies. These will be added to the list of products taxed since 2019, after the EU and US came into conflict over subsidies for aircraft manufacturers Airbus and Boeing.


Boeing’s 737 Max jet has resumed passenger flights in the US with an American Airlines flight between Miami and New York. Regulators grounded the plane in March 2019 following two separate deadly crashes within five months. The Federal Aviation Administration lifted the ban last month after Boeing agreed to new safeguards.

Nothing on this website should be construed as personal advice based on your circumstances. No news or research item is a personal recommendation to deal.

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