News & Insight • Weekly Newsletters

14 August 2020 | William Buckhurst

That Was The Week That Was

MACRO

• UK GDP for the second quarter comes in at -20.4%, the deepest quarterly contraction on record; but output grew by 8.7% in June, faster than expected
• In the US, Joe Biden, who remains ahead of Trump in the polls, named Kamala Harris as his running mate. She is the first woman of colour to join a major US party’s national ticket
• Following a rise in coronavirus cases in France, mainly centred around Paris and Marseilles, Boris Johnson imposed a two-week quarantine on Brits returning from France

STATISTIC OF THE WEEK

A new survey from Kings College London which took in detailed interviews from a sample of 2,237 UK residents aged 16-75 showed that if no treatment for coronavirus can be found, an enormous 87% would accept local lockdowns.

COMPANY NEWS

• Nike shares performed well following a positive second quarter sales update from Footlocker, the New York- based specialty athletic retailer
• Prudential announced that it intends to fully separate its US insurance business, Jackson, commencing with a minority IPO planned for first half of 2021 and full divestment over time
• Quarterly results from Cisco showed weaker than expected sales but marginally better profits as they were able to cut costs during the quarter

FUNDS

An update from an analyst who covers the renewable infrastructure funds showed how the sector has grown more reliant on the vagaries of the wholesale power price as subsidy regimes have fallen away; and in some cases have debt structures that would not be able to withstand a prolonged fall in power prices.

THIS WEEK IN HISTORY

1920: Charles Ponzi is arrested. After the fraud was announced, it would bring down five banks, most notably the Hanover Trust. In total, about $20 million was lost to Ponzi’s scheme

1998: Russia puts capital controls on the ruble, attempting to limit the currency’s decline. Russia’s stock market falls 6% on the news and is down 75% year to date. Short term interest rates in Russia are at 200% at the time

 RE-OPENING TIMES

UK Chancellor Rishi Sunak’s “eat out to help out” scheme looks to be a great success. Diners used the scheme more than 10.5 million times in its first week, the Treasury has said. Research showed that food sales in pubs and restaurants were up by between 95-106% on the first three days of the scheme.

MARKET DATA

As at 14^th August 2020. Source: Financial Express

Download the PDF here

This publication has been produced by Vermeer Investment Management Limited (VIM) trading as Vermeer Partners. It is provided for information purposes only. VIM makes no express or implied warranties and expressly disclaims all warranties of merchantability or fitness for a particular purpose or use with respect to any data included in this publication. VIM will not treat unauthorised recipients of this publication as its clients. Prices shown are indicative and VIM is not offering to buy or sell or soliciting offers to buy or sell any financial instrument. Without limiting any of the foregoing and to the extent permitted by law, in no event shall VIM, nor any of its officers, directors, partners, or employees, have any liability for (a) any special, punitive, indirect, or consequential damages; or (b) any lost profits, lost revenue, loss of anticipated savings or loss of opportunity or other financial loss, even if notified of the possibility of such damages, arising from any use of this publication or its contents. Other than disclosures relating to VIM, the information contained in this publication has been obtained from sources that VIM believes to be reliable, but VIM does not represent or warrant that it is accurate or complete. VIM is not responsible for, and makes no warranties whatsoever as to, the content of any third-party website referred to herein or accessed via a hyperlink in this publication and such information is not incorporated by reference. The views in this publication are those of the author(s) and are subject to change. VIM has no obligation to update its opinions or the information in this publication. This publication does not constitute personal investment advice or take into account the individual financial circumstances or objectives of the client who receives it. Any securities discussed herein may not be suitable for all investors. VIM recommends that investors independently evaluate each issuer, security or instrument discussed herein and consult any independent advisors they believe necessary. The value of and income from any investment may fluctuate from day to day as a result of changes in relevant economic markets (including changes in market liquidity). The information herein is not intended to predict actual results, which may differ substantially from those reflected. Past performance is not necessarily indicative of future results. This material has been issued and approved for distribution in the UK and European Economic Area by VIM.

©2019 Vermeer Investment Management Limited. All rights reserved. No part of this publication may be reproduced or redistributed in any manner without the prior written permission of VIM. VIM is authorised and regulated by the Financial Conduct Authority (FRN: 710280) and is incorporated in England and Wales (company number: 09081916).