European markets fared the worst, off around 9%, whilst UK and US stocks slipped by around 6%. But then the clouds appeared to begin to disperse with (apparently) a clear outcome to the Presidential Election (with the probability of a Republican Senate acting as a break on policies that might lean too far to the left for the markets) and a return to rather less aggressive international relations. Then came the Pfizer vaccine news, which has the potential to remove the greatest concern for markets.

Stocks have rallied sharply around the world, recovering all the ground lost and moving ahead through some notable index levels. The vaccine news has also triggered a major change in sectoral leadership away from the growth/momentum sectors and back to ‘value’. The NASDAQ Composite Index, which has led markets for so long, now appears to be topping-out as ‘big tech’ takes a breather.

Most striking is the recovery in the banks: Banco Santander has jumped 40% over this period, Barclays by 30%, Societe Generale and HSBC both around 25% higher. The industrials and the oil majors are not far behind: General Electric and Honeywell have both recovered around 20% and Rolls Royce by 30% (bearing in mind quite how far these stocks have fallen, RR is still down around 60% over the year). Amongst the oils, Royal Dutch Shell has rallied by 22%, Chevron by 16% and Repsol by 30%, though these moves have yet to be confirmed by the price of oil itself. It is not just ‘value’ stocks that have bounced, many of the higher quality names that will undoubtedly fare better if we can defeat COVID-19 have also picked-up again, for example, LVMH by 15%, Heineken by 17% and Compass Group by 18%.

Not so happy were a number of the ‘defensive’ sectors, such as pharmaceuticals, Roche Holding and Novartis are unchanged while Nestle and Unilever were both down a shade. Among the NASDAQ leaders, Amazon.com is down over the period and under assault by Margrethe Vestager (bane of the US tech stocks) of the European Union for allegedly breaking anti-trust regulations. Microsoft was barely changed while Nvidia and Salesforce were both down marginally.