After two days of strong gains, yesterday’s European session was more of a consolidation session, with some modest profit taking, after the UK became the latest country to impose slightly stronger Covid restrictions on its population.
Having recovered most of the losses seen in the post-Thanksgiving sell-off investors now caught between hope that vaccines will be able to afford enough protection against the new variant, against concerns that even a significant acceleration in infection rates might overwhelm health systems.
The news that a third dose of the Pfizer/BioNTech vaccine would afford decent protection against Omicron did initially prompt a sharp move higher, however the move didn’t stick, largely down to ongoing uncertainty about how the spread of the virus will affect economic growth right now.
The modest tightening of restrictions in England, while inconvenient still pales into insignificance when compared to the measures being implemented across Europe, which makes the slide in the pound a little bit puzzling. In comparison to…
