The Opening Belle - Goodbye 2020, It's Been... Emotional

U.S. Senate leader Mitch McConnell dealt a likely death blow on Wednesday to President Donald Trump’s bid to boost coronavirus aid to Americans, declining to schedule a swift Senate vote on a bill to raise relief checks to $2,000 from $600.

McConnell said on the Senate floor that a bill passed by the Democratic-controlled House of Representatives, which sought to meet fellow Republican Trump’s demands for bigger checks, “has no realistic path to quickly pass the Senate.”

McConnell, who controls the Senate’s agenda and opposes the increase in aid, had introduced a competing bill combining the $2,000 checks with provisions unacceptable to Democrats, who could block it.

With a new Congress set to be sworn in on Sunday, the action appears all but certain to kill the effort to increase the amount of the $600 checks Congress has already approved.

Appearing to shrug off Trump’s own initiative, McConnell continued: “The Senate is not going to be bullied into rushing out more borrowed money into the hands of Democrats’ rich friends who don’t need the help.”

The House of Representatives voted to overturn Trump’s defense bill veto on Monday. Once preliminary hurdles in the Senate are cleared, a final vote could come later in the week or over the weekend.

The U.S. government on Wednesday said it would raise tariffs on certain European Union products, including aircraft components and wines from France and Germany, the latest twist in a 16-year battle over aircraft subsidies between Washington and Brussels.

In a statement, the Office of the U.S. Trade Representative (USTR) said it was adding tariffs on aircraft manufacturing parts and certain non-sparkling wines as well as cognacs and other brandies from France and Germany.

The USTR did not say when the tariffs would take effect but noted that additional details would be “forthcoming.”

Activity in China’s services sector expanded at a slower but still strong pace in December, official data showed on Thursday, supported by pent-up demand as the recovery from the coronavirus gathered pace.

The official non-manufacturing Purchasing Managers’ Index (PMI) fell to 55.7 in December from 56.4 in November, data from the National Bureau of Statistics (NBS) showed. The 50-point mark separates growth from contraction on a monthly basis.

Though slower than manufacturing, China’s services sector, which includes many smaller and private companies, has posted solid growth thanks to strong domestic demand.

The official November composite PMI, which includes both manufacturing and services activity, fell to 55.1 from November’s 55.7.

“It’s a gradual plateauing,” said Bo Zhuang, chief China economist at TS Lombard. “We have passed the peak of the strong recovery, as suggested by exports and industrial shortages. I think the PMI from here might be peaking as the credit growth is peaking out.”

The sub-index for new export orders moderated slightly to 51.3 in December from 51.5, suggesting normalization in demand following a seasonal surge for the Christmas holidays.

“It is still a level that is consistent with very solid growth,” Qian Wang, Asia-Pacific chief economist at Vanguard Group Inc., said in an interview on Bloomberg TV. “The Chinese economy seems to be holding up pretty well in spite of the second wave on the external side”.

“Employment is still relatively weak and wage growth is still at a low growth rate,” said Zhuang of TS Lombard. “It’s a challenge for retail sales and consumption.”

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The biggest vaccination campaign in history has begun. More than 6 million doses in 26 countries have been administered, according to data collected by Bloomberg. Delivering billions more will be one of the greatest logistical challenges ever undertaken.

Vaccinations in the U.S. began Dec. 14 with health-care workers, and so far 3.05 million doses have been administered, according to a state-by-state tally by Bloomberg and data from the Centers for Disease Control and Prevention.

China’s drug regulator approved the country’s first coronavirus vaccine for general public use, a sign of confidence in the experimental shots the nation plans to roll out within and beyond its borders.

China’s National Medical Products Administration gave the authorization to a Covid-19 vaccine developed by state-owned China National Biotec Group Co., a unit of Sinopharm, officials told reporters in Beijing Thursday.

With the approval, the vaccine -- which has been authorized for emergency use in China since mid-year along with other frontrunner shots -- will be made commercially available, meaning it can be administered to the general population. Regulators from the U.S. to Singapore have approved shots over the past month, among them vaccines developed by Pfizer Inc., Moderna Inc. and AstraZeneca Plc, but those have been largely for emergency use, a status China granted to its developers months ago.

China will target members of the population at higher risk in its inoculations, among them the elderly and those with pre-existing conditions, and then roll vaccines out to the general public, Zeng Yixin, vice minister of the country’s National Health Commission, said at the briefing.

Boris Johnson has said Britain is in a "race" to roll out a newly-approved Covid vaccine in order to avoid a third national lockdown as the new virus variant surges across the country.

On the day regulators finally approved the Oxford University/AstraZeneca jab, the Prime Minister was forced to place more than three quarters of the country into the highest tier of Covid restrictions.

On Wednesday, 50,023 people tested positive for the virus, with 981 deaths, the highest number since April.

Mr Johnson said there was light at the end of the tunnel and that "the tunnel has been shortened and we are moving faster through it" thanks to the efforts of British scientists.

British lawmakers approved Prime Minister Boris Johnson’s post-Brexit trade deal with the European Union on Wednesday, as both sides looked to begin a new chapter of relations just days before their divorce becomes a reality.

“Brexit is not an end but a beginning,” Johnson said. “The responsibility now rests with all of us to make the best use of the powers that we regain, the tools that we’ve taken back into our hands.”

Parliament’s lower house voted 521 to 73 in favour of the deal.

Britain’s Queen Elizabeth gave final approval to the legislation which enabled the government to implement and ratify the UK’s trade deal with the European Union. The so-called Royal Assent was effectively a rubber-stamp for the law which passed through parliament.

“House of Lords is notified of Royal Assent to the European Union (Future Relationship) Act,” the House of Lords said in a tweet after midnight.

Johnson said he hoped to end the “old, tired, vexed question of Britain’s political relations with Europe” and instead become “the best friend and ally the EU could have.”

Brazilian President Jair Bolsonaro said that he would sign a decree later on Wednesday raising the national minimum wage by 5.26% to 1,100 reais ($211.80) per month beginning on Jan. 1.

Bolsonaro said on Twitter that he would make the change via a temporary decree that requires Congressional approval to take permanent effect.

Bundesbank President Jens Weidmann warned euro zone governments forced to increase public debt to support their economies during the coronavirus pandemic not to expect the European Central Bank to keep interest rates low forever.

“We will not take into consideration sovereign debt servicing costs if price stability mandates higher interest rates,” Weidmann, a member of the ECB’s Governing Council, told the Rheinische Post newspaper in remarks published on Thursday.

“In their own interest, governments should prepare for a rise in interest rates and not pretend that their debt burden can be serviced easily,” said Weidmann.

Energy, Wall Street’s worst performing industry in 2020, could see its fortunes improve in the new year after its price action surfaced a technical buy signal on the charts on Wednesday.

The bullish development in S&P 500 energy sector is called a “golden cross,” which is conventionally defined by technical analysts as the 50-day moving price average rising above the 200-day moving average. On Wednesday, the index closed up 1.6%, its 50-day average rose to 266.26, eclipsing the 200-day average at 266.21.

It is up 5.1% in December. But it remains on track for its biggest yearly collapse on record and is the worst performing of the 11 S&P 500 industry sectors, owing to the global economic contraction during the coronavirus pandemic that crushed demand for oil, natural gas and fuels like gasoline.

“Golden crosses may be considered bullish technical patterns in theory, but in practice, they don’t always play out that way,” Paul Hickey at Bespoke Investment Group wrote in a note on Wednesday.

Bespoke showed that of the 11 golden crosses for the energy sector since 1990, one-week and one-month performances were positive more than half the time after they occurred. However, the performance was negative six of 11 times over three months and six months.