While Western Europe and North America are expected to have vaccinated 60% of their populations by mid-2022, only five Asian countries are currently on course to do the same. Consequently, the region is expected to suffer the lion’s share of the $2.3trn in GDP losses forecast to arise from vaccination delays by 2025.
The news that Apple plans to add satellite functions to future iPhones, enabling them to send SOS texts beyond cellular range, was all it took on Monday (30 Aug) for its shares to gain 2.2%. Apple is now up over 18% this year with the latest record high in its shares taking its valuation past $2.5trn for the first time.
Other tech giants such as Microsoft and Tesla also added to recent gains on Monday. Along with renewed demand for consumer discretionary stocks, the gains helped the S&P 500 to post its 53rd record high closing of the year. With one trading day left in August, the index was up 20.6% from the start of the year and on course for its strongest first eight months since 1997.
Stock markets bounced on Friday (27 Aug) when US Federal Reserve chairman, Jerome Powell, reiterated that higher inflation would be temporary and stressed that the tapering of the Fed’s asset purchase programmes, when it comes, wouldn’t signal imminent rate increases.
The latest Lloyds Bank business survey reports that, in August, UK business confidence hit its highest level since April 2017 amid the relaxation in lockdown restrictions and changes to the self-isolation rules. Optimism over the economic outlook also recorded its first gain in three months (up 6%) while the number of UK firms expecting stronger business activity in the year ahead jumped 7% (to 48%).
The figures follow the second-quarter rebound in UK growth which saw GDP gain 4.8%. With pubs and restaurants reopening, the greatest monthly increase in confidence was in the services sector; its reading of 36% was the highest since January 2018.
Even so, potential staffing problems remain a worry. Only 18% of companies expected to increase headcount this year while a third of businesses expect pay to rise by at least 2%.
Meanwhile, figures published on Monday (31 Aug) showed business sentiment in the eurozone dipped in August due to fears of an autumn resurgence in the virus.