FT News Briefing Covid-19 shakes US equities, OECD warns against post-pandemic austerity
Jan 5, 2021
US stocks faced a major downturn as rising Covid-19 cases rattled investors. Brexit caused a significant shift in EU share trading away from London, raising concerns about the future of the financial hub. Meanwhile, China's currency surged, reflecting the nation's economic resilience. The OECD highlighted the urgent need for governments to avoid premature austerity and continue supporting the economy, urging a rethink on public spending limits to safeguard recovery.
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US Equities Tumble
- US equities suffered their worst day since October due to rising coronavirus cases and lockdowns.
- The S&P 500 and Nasdaq both fell 1.5%, with losses across various sectors.
Post-Brexit Trading Shift
- Nearly €6 billion in EU share trading shifted from London to European exchanges after Brexit.
- This change resulted in less tax revenue for the UK and new restrictions for London investors.
Renminbi Rally
- China's renminbi rallied to its highest level since mid-2018, surpassing 6.5 per dollar.
- Factors include China's economic recovery, a weakening dollar, and increased investor interest.