Week ahead: UK leads vaccine charge, Salesforce picks up (the) Slack
The big news this week is the UK’s rollout of Pfizer-BioNTech’s Covid-19 vaccine. Could normality be coming finally after a topsy turvy year? Also, Salesforce buys Slack Tech, and the ECB holds its latest press conference to detail the EU’s financial outlook.
UK Vaccine Rollout
The UK approved the Pfizer-BioNTech two-dose vaccine as safe last week – and this week it begins and ambitious roll out programme designed to get the most vulnerable immunized as quickly as possible.
Starting with care home residents and their carers, down nine steps to over 50s, a host of priority groups have been identified. No such luck for those under 50, who will have to wait, but once the priority groups have been jabbed, younger generations will get their shot.
800,000 doses will have been delivered in the first vaccine wave.
A vaccine that works will be essential for returning to normalcy in all walks of life, including trading. The UK is something of a guinea pig here, being the first developed nation to a) approve one of the myriad vaccines under development and b) tackling a mass vaccination programme.
PM Boris Johnson has said the UK now faces a “massive logistical challenge” to get the vaccine where it’s needed, perhaps ignoring the fact the NHS rolls out immunization programmes to millions of vulnerable people every year. Still, this is an extraordinary event for an extraordinary twelve months, so we’ll have to wait and see how the roll out is managed.
Economic implications of a vaccine are broadly very positive. For instance, it should support cyclical parts of the market forecast to struggle. It could provide the basis for a broader rally in equities too, and spur on rotation from big tech stocks that have been real pandemic winners.
The FTSE 100 started December in the same vein as November’s big rally. Could UK equities start to shine again? A vaccine may be the shot in the arm they need to start performing once more.
Still, it’s early days. The important thing is the vaccine has been approved and beginning to circulate. All eyes will be on the UK and its (hopefully) immunized population.
Slack announces Q3 earnings as Salesforce prepares to buy company
Work communications software provider Slack announces its Q3 2021 earnings this week just days after Salesforce announced its attentions to buy the company last week.
Q2 2021 earnings for Slack showed a 49% year-on-year revenue increase, reaching a total $215.9m. Customer growth also accelerated in 30% y/y, with over 130,000 customers utilising Slack software.
Will its Q3 earnings reflect further growth and pay off for Salesforce?
At $27.7bn, Slack will be the biggest acquisition that Marc Benioff-owned Salesforce has made to date. It’s hoped that with the deal, the distance between it and Microsoft will become somewhat shorter in the corporate communications race.
Slack’s software offer is similar to Microsoft teams. No doubt readers, very likely working from home for the past several long months, will now be intimate with Teams – the de facto choice of work communications software for businesses globally.
Slack shareholders will receive $26.79 in cash and 0.0776 shares of Salesforce common stock under the deal. Salesforce agreed to pay a 55% premium to Slack stock’s November 24th 2020 closing price.
ECB press conference
The ECB will reveal its latest policy decisions at its December press conference this week.
Stimulus is grabbing all the headlines. The Bank’s chief economist, Philip Lane, has said “worrying signals” that financial conditions for banks and small businesses are getting tighter.
The minutes from the ECB’s last set of meetings are not painting a glowing picture of economic stability within the EU. The bloc’s economy, like pretty much everyone’s, has taking a hefty hit from a one-two combo of Covid-19 and lockdown.
“It could not be excluded that the euro area, or at least some countries, would experience a double-dip recession,” they warned.
According to comments made in October, the ECB is “recalibrating” its monetary instruments and will announce the outcomes at its December 10th press conference. Analysts expect it to expand both its bond-buying programme and ultra-cheap loans to banks.
Essentially, investors have interpreted this that another substantial package of monetary easing measures is on the way. It should be pointed out that not all EU member states are particularly happy with this, expressing concern over “possible non-linearities, side effects and ‘diminishing returns’ in an environment of high uncertainty and very favourable financial conditions”, per October’s meeting minutes.
Market participants will also be watching for any comments about the single currency’s appreciation. The euro jumped to multi-year highs against the dollar last week, breaking the psychologically important 1.20 level, which has in the past triggered attempts by policymakers to jawbone the currency lower.
Webinars to watch
Trading pro Mark Leigh is once again holding a suite of educational trading-focussed webinars this week to help you get further insights into the nitty gritty of trading. Highlights include:
Mark Leigh’s Trader Clinic
Monday 7th December – 2.00pm GMT
See how a professional uses the ups and downs of trading to hone their strategy and improve their returns with our Trader Clinic.
Technical Indicators to Understand and Apply to your Trading Strategy
Monday 7th December – 5.00pm GMT
Although there are hundreds of different technical indicators, this can often lead to confusion and contradictory signals. Learn Mark Leigh’s indicators of choice and how to use them together with your trading strategy.
How to use Japanese Candlesticks to Recognise Trade Setups
Tuesday 8th December – 6.00pm GMT
Candlestick charts are the accepted industry standard for technical traders. Learn how to read and understand Japanese candlesticks and how to use this information in your trade making decisions.
FXtrademark has a Proprietary Scorecard System for every Trade Setup
Wednesday 9th December – 5.00pm GMT
Learn to use the FXtrademark scorecard where you will score each trade set-up on a scale from 0 to 10 based on predetermined criterion. This system will allow you to trade with a system and a plan as opposed to making arbitrary decisions based on emotions.
Putting it All Together with Money Management, Psychology and Analysis
Thursday 10th December – 6.00pm GMT
No strategy, signal or trading plan can succeed without proper calculated money management. Risk/reward practices and position sizing is paramount in developing your trading plan. Although new traders only want strategies and signals to start their trading careers, all experienced and successful traders understand and know that it’s all about the psychology of trading that separates successful from unsuccessful traders.
Major Economic Data
|Sun Dec 6||9.30pm||AUD||AIG Services Index|
|Mon Dec 7||3.00pm||CAD||Ivey PMI|
|Tentative||CAD||Annual Budget Release|
|11.50pm||JPY||Final GDP q/q|
|Tue Dec 8||12.01am||GBP||BRC Retail Monitors y/y|
|Tentative||GBP||FPC Meeting Minutes|
|Wed Dec 9||1.30am||CNH||PPI y/y|
|3.00pm||CAD||BOC Rate Statement|
|3.30pm||USD||Crude Oil Inventories|
|Thu Dec 10||7.00am||GBP||GDP m/m|
|12.45pm||EUR||Main Referencing Rate|
|12.45pm||EUR||Monetary Policy Statement|
|1.30pm||EUR||ECB Press Conference|
|1.30pm||USD||Core CPI m/m|
|Fri Dec 11||1.30pm||USD||Core PPI m/m|
Key earnings data
|Mon Dec 7||Coupa Software Inc.||Q3 2021 Earnings|
|Tue Dec 8||Brown-Forman Corp.||Q2 2021 Earnings|
|AutoZone Inc.||Q1 2021 Earnings|
|Ashtead plc.||Q3 2021 Earnings|
|MongoDB||Q3 2021 Earnings|
|Guidewire Software Inc.||Q1 2021 Earnings|
|Wed Dec 9||Adobe Inc.||Q4 2020 Earnings|
|Campbell Soup Co.||Q1 2021 Earnings|
|Thu Dec 10||Oracle Corp.||Q2 2021 Earnings|
|Costco Wholesale Corp.||Q1 2021 Earnings|
|Broadcom||Q24 2020 Earnings|
|Lululemon||Q3 2020 Earnings|
|Vail Resorts||Q1 2021 Earnings|
|Fri Dec 11||Carl Zeiss Meditec AG||Q4 2020 Earnings|