The markets have been doing well enough without a bit of Christmas magic – but will the jingle bells of a holiday rally come into play in the final full week of December?
US: Will Santa rally arrive in run-up to Christmas?
Though its progress closing above 30,000 has been rather stop-start, it isn’t out of the realms of possibility that the Dow Jones could strike 31,000 before the year is out.
By Monday morning investors should know whether Congress have been able to pass the $908 billion relief bill, a huge factor in whether or not the Dow can keep climbing in the final couple of weeks of 2020.
In regards to data, the States is the only region with something approaching a full calendar. The final fourth quarter GDP reading – which currently stands at 33.1% at the annualised rate – arrives on Tuesday, in the week’s most notable figure.
On Wednesday a stuffed afternoon then sees core PCE price index, personal income, personal spending, new home sales and revised consumer sentiment numbers, followed on Christmas Eve by the durable goods orders and latest jobless claims readings.
UK: Deal or no deal?
If Michel Barnier is correct, the question of deal or no deal should finally have been settled by start of trading on Monday. That will have huge implications for how the FTSE and pound finish off 2021; it will be especially interesting to see whether the antagonistic relationship between index and currency remains in place, or whether they will rise or fall in tandem due to the seismic nature of the news.
Beyond Brexit – and that’s a huge obstacle for UK investors to look past – there is the CBI realised sales number on Monday, and the final Q4 GDP, current account and public sector net borrowing readings on Tuesday.
The rest of the week is then pretty barren, in the run up to Christmas Day on Friday.
Like in the UK, the Eurozone calendar is effectively empty from Wednesday onwards. Before then, there’s the consumer confidence figure on Monday, and the German Gfk consumer climate reading on Tuesday.
The likes of the DAX and CAC may also be impacted by the Brexit talks outcome, even if only by their relationship to the euro.
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