Investors’ fears of a second wave of the coronavirus pandemic in Europe are on the rise today as countries are beginning to impose more travel restrictions on one another. The latest development comes from the United Kingdom, where a 14-day quarantine rule was implemented against people coming from France and the Netherlands. These two countries had 2,700 and 580 new Covid-19 cases yesterday. Spain, which saw an increase of almost 3,000 cases on Thursday was already on the UK’s quarantine list.
In addition, the Old Continent is also dealing with a new geo-political crisis, this time hailing out of Belarus. The country just went through presidential elections where Alexander Lukashenko won a second term. However, the elections were quite controversial and protests erupted in the country, which led to clashes with the police. Now the European Union is considering new sanctions against Belarus for human rights violations.
Furthermore, today we expect the July retail sales report out of the United States, which traditionally complements the unemployment data we receive each Thursday. The report is expected not to bring any surprises, however, it is important to note that it does not cover the period after the previous round of stimulus expired.
Speaking of which, the US government has once again failed to proceed with the stimulus bill negotiations. An agreement between the House of Representatives and the Senate has proven difficult, which caused the White House (via the Treasury) to join the negotiations.
But since Trump’s administration stepped in, the Republican-dominated Senate has taken a step back, leaving the House and the White House to negotiate alone. Now the Senate announced it will be going on a summer break, despite the pressure to come up with a new stimulus bill. The US stock markets are turning more and more negative each day due to the deadlock.
