Skip navigation Scroll to top
Scroll to top

LGT Navigator: Between corona fears and vaccine hopes 

November 20, 2020

Currently, fears about the negative economic impact of pandemic countermeasures are balanced by positive signals regarding the development of a Covid-19 vaccine. This is leading to a more cautious attitude of investors in the capital markets. The current drama surrounding the outcome of the US presidential election organized by Trump's lawyers is adding uncertainty and weakening the measures against the corona crisis. Meanwhile, in view of the expected negative effects on the euro economy from the second wave of corona, ECB head Lagarde held out the prospect of further monetary easing in December.

Between corona fears and vaccine hopes 

Further positive news on potential Covid-19 vaccines is intensifying the light at the end of the corona tunnel. The University of Oxford, for example, expects the results of a pivotal study of its corona vaccine developed together with AstraZeneca before the end of the year. However, it is currently too early to make any statements on the effectiveness of the vaccine. AstraZeneca is one of the leading companies in the race for a Covid-19 vaccine, along with Pfizer, the German biotech company BioNTech and the US pharmaceutical group Moderna.

In the drama surrounding the US presidency yesterday, the lawyers of the incumbent President Donald Trump tried to sow further doubts about the outcome of the election, but without presenting conclusive evidence. Nevertheless, according to a CNN poll, about 70% of Republican voters now doubt the legitimacy of Biden's victory. Meanwhile, it has been confirmed that President-elect Joe Biden has won the state even after a recount of votes in Georgia. As of today, Biden leads with 306 voters, ahead of Trump with 232.

On Wall Street, the indices recorded slight gains on Thursday. The Dow Jones Industrial closed +0.15% higher at 29 483.23 points and the S&P 500 ended the day's trading up +0.39% at 3 581.87 points. At the end of the week there was no uniform trend in Asia and the stock futures did not signal a clear direction for the European stock exchanges either.

ECB President Lagarde promises further monetary policy action

The European Central Bank (ECB) is likely to announce a further easing of its monetary policy at its next monetary policy meeting. This is confirmed by the latest statements by ECB head Christine Lagarde. The central bank President told the EU Parliament that the ECB will tackle the current phase of the corona crisis with the same approach and determination. In principle, all options are available, whereby above all the billion-euro Corona Securities Purchase Program (PEPP) and the long-term loans for banks (TLTRO) have been effective in the current environment. These could be adjusted “dynamically“ on December 10, the president of the central bank said.

Latest US economic data do not show a consistent picture

The economic outlook for the US economy appears to have improved somewhat in October. This was indicated by the composite index of leading economic indicators, which rose by +0.7% compared with the previous month. This indicator, which is made up of ten leading economic data, is intended to outline the economic development in the next six months. At the same time, although the Philadelphia Federal Reserve's industrial barometer showed a slowdown in activity in the economic region in the northeastern United States, the decline in the Philly Fed index was less severe than analysts had predicted. The indicator dropped from 32.3 points in the previous month to 26.3 points. Analysts had anticipated a sharper decline to the 22.5 mark. However, the latest data from the labor market turned out to be more negative than expected. The number of first-time applications for unemployment benefits in the US rose again unexpectedly. Last week, the number of applicants increased by 31 000 to 742 000. Analysts had expected a decrease to 707 000. The corona pandemic still has a firm grip on the world's largest economy and of the 22 million jobs lost during the crisis, only about 12 million have been regained during the economic recovery.



Economic Indicators November 20

MEZ Country Indicator Last
08:00 UK Retail Sales (October, y/y) +4.7%
10:00 IT Industrial Orders (October, y/y) +6.1%
16:00 EZ Consumer Confidence (November) -15.5

Earnings Calendar November 24

Country Corporate Period
UK Compass Group Y
IE Medtronic Q2


LGT helps you make informed investment decisions

All about global economic and market trends at a glance

Subscribe to LGT's research newsletters

You can also follow us on Facebook or LinkedIn – or visit MAG/NET and discover interesting background articles. If you have questions, a consultant from the bank will be happy to help you.

Publisher: LGT Bank (Switzerland) Ltd., Glärnischstrasse 36, CH-8027 Zurich
Editor: Alessandro Fezzi, +41 44 250 78 59, E-Mail:
Source: LGT Bank (Switzerland) Ltd.

Risk Disclosure (Disclaimer)
This publication is an advertising material / marketing communication. This publication is for your information only and is not intended as an offer, solicitation of an offer, or public advertisement to buy or sell any investment or other specific product. Its content has been prepared by our staff and is based on sources of information we consider to be reliable. However, we cannot provide any confirmation or guarantee as to its being correct, complete and up to date. The circumstances and principles to which the information contained in this publication relates may change at any time. Information that has been published should therefore not be understood as implying that no change has taken place since its publication or that it is still up to date. The information in this publication does not constitute an aid for decision-making in relation to financial, legal, tax-related or other consulting matters, nor should any investment decisions or other decisions be made on the basis of this information alone. It is recommended that advice be obtained from a qualified expert. Investors should be aware that the value of investments can fall as well as rise. Positive performance in the past is therefore no guarantee of positive performance in the future. Investments in foreign currencies are also subject to fluctuations in exchange rates. We disclaim all liability for any loss or damage of any kind, whether direct, indirect or consequential, which may be incurred through the use of this publication. This publication is not intended for persons subject to legislation that prohibits its distribution or makes its distribution contingent upon an approval. Any person coming into possession of this publication shall therefore be obliged to find out about any restrictions that may apply and to comply with them. In line with internal guidelines, persons responsible for compiling this report are free to buy hold and sell the securities referred to in this report.

US employment growth remains dynamic at the beginning of the year