In our weekly Market Monday insights, Prosperity Investment Management examines the latest developments across the globe's biggest financial markets - providing you with all the latest information you need to know.
After a sharp sell-off early last week, attributed to fresh concerns about the Delta variant of coronavirus, stocks in the United States rebounded towards the latter end of the week.
Many observers linked the steep declines at the start of the week to growing fears about the spread of the Delta variant of coronavirus. Cases and hospitalisations rose in many parts of the country, particularly in states with low vaccination levels. Stocks tied to the reopening of the economy, such as cruise operators and airlines, fared particularly poorly with much of the gains concentrated in technology and internet-related giants.
European economies continued to reopen despite a sharp rise in coronavirus infections. New cases climbed by 40% over the past week in the UK, where workforce shortages have been exacerbated by a government-backed smartphone app that alerts people who may have crossed paths with an infected person and advises a period of self-isolation. After the UK lifted all remaining restrictions last Monday, both Prime Minister Boris Johnson and Leader of the Opposition, Sir Keir Starmer, had to quarantine.
Meanwhile, the French government said that it could not rule out the reintroduction of curfew measures if infections continue to climb at such a fast rate. In Spain, several regions requested the reintroduction of some restrictions.
Japan’s government updated its basic energy plan, with the draft expected to be approved by the cabinet later this year. It outlines ambitions to drastically increase the country’s renewable energy use and reduce fossil fuel consumption over the next decade to meet carbon emission targets. Prime Minister Yoshihide Suga has pledged that Japan will strive to achieve carbon neutrality by 2050. The plan also states that Japan will aim to reduce its reliance on nuclear power as much as possible, but that it remains an important energy source. The country’s nuclear industry has struggled since the 2011 Fukushima power plant disaster and anti-nuclear sentiment is strong among the public.