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Blockades in Europe are a warning to the United States



What’s happening: Paris has imposed a night curfew. In London, people from different families are forbidden to meet at home. The measures are an attempt to stem the rapid increase in Covid-19 cases across the continent, as hospital capacity again becomes a concern.

Shares in London, Paris, Milan and Frankfurt were sold sharply on Thursday before rebounding on Friday. Markets aren’t running out like they did in March, but rapid climate change still comes with a caution.

On Friday, economists at Bank of America in Europe simply said it in a note to clients: “Yes, that’s bad.”

“Localized and surgical restrictions could become more disruptive if they continue to increase,”

; they said. “The precautionary savings, which are already large, could further increase driven by the uncertainty linked to the virus. And voluntary social detachment can easily amplify the economic impact of the resurgence of the virus.”

The size of the economic impact of the new measures is difficult to ascertain, especially given the patchwork response in countries like the UK, where cities like Liverpool face even stricter rules than London.

“It will be monitoring the extent and extent of the restrictions [of] utmost importance for the future, “said Deutsche Bank economist Sanjay Raja. He sticks to his forecast for 2% growth in the UK between October and December, but said that if further restrictions are imposed, the economy will it may freeze completely.

Allianz now expects major European economies to contract again in the final quarter of the year, with the Spanish economy contracting 1.3% from the previous quarter and the French economy down 1.1%.

Big picture: There is little reason to think that the challenge facing leaders in Europe – to act decisively and try to avoid a worsening of the health crisis, or take moderate measures that could protect fragile economic gains – is purely a local phenomenon .

See here: New York City is grappling with a Covid-19 renaissance in some boroughs of Brooklyn and Queens by shutting down non-essential businesses and schools in some areas, an attempt to avoid wider disruptions for now.
In the United States, the one-week average of new cases per day has moved above 53,000, an increase of more than 55% in just over a month, according to data from Johns Hopkins University.
CNN Business and Moody’s Analytics Back-to-Normal Index shows that the recovery in the US has steadily stabilized since mid-September. Yet Europe demonstrates how quickly the situation can reverse.
Investor Analysis: European equities have enjoyed greater investor demand in recent months. Fund managers pointed to Europe’s relative control of the virus after spring, as they praised an agreement between EU leaders to raise € 800 billion ($ 938 billion) for review efforts. Without the first part of that equation, however, the region could struggle.

Netflix is ​​having a scary year. Can it continue like this?

It will come as no surprise to anyone who has crouched at home that Netflix is ​​experiencing a knockout year.

While cinemas are rapidly running out of money, Netflix is ​​thriving. The streaming service added 26 million subscribers in the first half of the year as the cultural conversation focused on shows like “Tiger King”. Last quarter, Netflix more than doubled its profits from the same period last year.

Look at the stock: Stocks skyrocketed 64% in 2020, while the S&P 500 gained nearly 8%.

Investors will tune in on Tuesday to see if Netflix can maintain momentum when it reports results for the quarter from July to September. The company said in July that it plans to bring in about 2.5 million subscribers during that period.

Bank of America analysts think subscriber numbers may be weaker this quarter, given increased competition from players like Disney + and NBC’s Peacock, the return of live sports, and an expected increase in people canceling subscriptions.

Even so, he raised his target for the stock to $ 670, a 26% increase from Friday’s closing price, due to faith in the company’s long-term strategy.

Next next

Monday: September Chinese GDP and Industrial Production, Retail Sales and Unemployment; Halliburton (HAL) is IBM (IBM) earnings
Tuesday: start of US housing and building permits; Lockheed Martin (LMT), Philip Morris (PM), UBS (UBS), Netflix (NFLX), Shoot (SHOOT) is Texas Instruments (TXN) earnings
Wednesday: UK inflation; Verizon (VZ), Chipotle (CMG), Tesla (TSLA) is Whirlpool (WHR) earnings
Thursday: Consumer Confidence from Germany and the UK; Japanese inflation; American Airlines (AAL), AT&T (T.), Coke (KO), Kimberly-Clark (KMB), Intel (INTC) is Mattel (MAT) earnings
Friday: PMI data; American Express (AXP) is Honeywell (HON) earnings

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