Weekly Client Update – Friday, 11th December

“Tis the season to abide by the rule of 10!

In Jersey family and friends can gather over Christmas, providing they abide by the rule of 10. The Government has announced its guidance for get togethers over the Christmas and New Year period as it seeks to allow some seasonal cheer while trying to stop the spread of Coronavirus.

In new guidelines covering 23 December to 5 January, The Government sticks to its rule of no indoor gatherings of more than ten people and no outdoor gatherings of more than 20, however gatherings of between six and ten people from multiple households can only happen up to 3 times over the 2 week period and there must not be more than one gathering of six to ten in one day. Children under 3 years of age will be exempt.

The Government decided to scrap plans to introduce bubbles after concluding that it was incompatible with the rule of ten. Islanders are also being advised to be consistent in the people they meet and will also be asked to keep a record of their contacts should they be needed by the ‘Track and Trace’ team. Chief Minister, John Le Fondre said “ the Three time limit” is there to protect the more vulnerable members of our families and our island.

In addition despite calls for schools to close a week early the States voted yesterday by a comfortable margin to keep them open as planned until next Friday stating that teenage children particularly are more likely to gather outside of school in clusters and may spread the virus more easily. As of today there are 630 active cases in the island with 25 in hospital and 4 in care homes. On a positive note the new first batch of Pfizer/BioNTech Coronavirus vaccine has arrived in the island and vaccinations of the elderly and vulnerable will start from Tuesday nest week!

Elsewhere there was bad news on jobs in both the UK and the US, and Japan became the latest country to launch a further Covid stimulus package for its economy.

As usual we have looked at all the main stories below – with the customary reminder that the stock market figures quoted were correct at close of business in the relevant market on Wednesday evening, and the commentary was written on Thursday morning so that the update could be with you on Friday.

The Latest News 

There is little point in going into the Brexit news in any granular detail. As we write, the BBC is reporting that ‘large gaps remain’ between the UK and the EU, with Sunday now the final deadline for any agreement to be reached. There are still considerable differences over fishing rights. Boris Johnson has stated that the UK ‘cannot be the only country in the world that doesn’t control its own waters.’ The two sides also appear to be some distance apart on the ‘level playing field.’ Simply put, the EU does not want to find a low-tax, low-regulation competitor right on its doorstep.

Hopefully by this time next week we will have some more definite news to bring you.

Meanwhile figures came out on Thursday morning showing that the rate of growth in the UK had slowed: the data from the Office for National Statistics showed just 0.4% growth in GDP in October. With next month’s figures – for November – due to reflect the second lockdown, the chart doesn’t look too rosy at the moment.

The unemployment rate rose to 4.8% in the three months to September, up from the previous 4.5%. With the furlough scheme still winding down, the unemployment figures can only get worse.

This mirrored news from the US, where jobs growth slowed sharply. The US economy added 245,000 jobs in November – well below many pundits’ expectations.

Back in the UK, new car sales were down (again) in November and, while the newspapers reported a ‘£10bn bounce back’ as lockdown ended and shoppers returned to the high street, the data showed that footfall was roughly 25% down on the same period last year.

In Europe work has once again come to a stop on Tesla’s new factory in Germany – the so-called Gigafactory – with environmentalists winning a court injunction, arguing that the factory will endanger the habitats of lizards and snakes.

In Japan, Prime Minister Yoshihide Suga announced a 73.6tn Yen (£530bn) stimulus package for the economy, aimed at correcting the damage done in the second quarter of the year when the Japanese economy shrank by 8.2%. The stimulus package will include subsidies for green investment and spending on digitalisation.

The Stock Markets 

On balance it was a good week for the stock markets we cover in the update. Let’s start at home, where the FTSE-100 index rose 2% to close Wednesday night at 6,564. The pound had another quiet week against the dollar, and ended almost unchanged at $1.3365.

Elsewhere in Europe the German DAX index ended the week unchanged in percentage terms at 13,340, while the French stock market drifted down 1% to 5,547.

Despite the poor data on jobs, this week saw the US Dow Jones index reach an all-time high of 30,223 on Monday. It had slipped back a little by Wednesday and ended the week at 30,069 where it was up 1%. The S&P 500 index was unchanged in percentage terms, closing Wednesday at 3,673.

In the Far East China was the market which lost the most ground this week. The Shanghai Composite index was down 2% at 3,372. The markets in Hong Kong and Japan were relatively unchanged at 26,503 and 26,818 respectively, while the South Korean market enjoyed a good week – ending Wednesday up 3% at 2,755.

Our Thoughts 

Brexit… It’s difficult to know what order to put things in. This week has seen ‘last ditch’ talks with the EU, the PM making a ‘last gasp dash’ to Brussels and ‘the final throw of the dice.’ Does a ‘last gasp’ come before or after ‘the final throw of the dice?’

We doubt that anyone – including the great and good eating a fish supper in Brussels – has a clue. What is certain is that by the time we send you next Friday’s update we should finally know whether it’s ‘deal or no deal.’

As we noted above, Thursday morning’s headlines hinted at ‘large gaps remaining’ but you suspect that a deal may still be done, if only because the EU has such a track record of last minute deals. Meanwhile the UK has quietly signed a free trade deal with Singapore worth £17bn.

The news bulletins over the next week will be showing you a lot more footage of people receiving the vaccine. That’s good news: as we reported last week, the overwhelming majority of firms are confident of bouncing back to health once the vaccine has been fully rolled out.

Finally this week we come to a story that may be bigger than both Brexit and the vaccine. Earth, it appears, has failed the interview and will not be admitted to the Galactic Federation.

According to professor, and retired Israeli general, Haim Eshed – and reports in several papers – there is a Galactic Federation of alien species among the stars. But they don’t want us humans to be part of their club, as we’re ‘not ready.’ The aliens won’t make this known publicly as they are worried that we’ll ‘freak out.’ They have, however, contacted President Trump who may be on the verge of revealing their existence and would likely do so on Twitter. Why would he do that? We don’t know; maybe the aliens are eligible for a postal vote in Pennsylvania…

Assuming we are still here next week then we’ll bring you the last client update before Christmas. In the meantime anyone who wants to read more about this story should simply tap ‘Aliens have contacted Donald Trump’ into Google. There are half a million results, so you won’t be short of something to read over the weekend…