Last month we ended with the great adage from Batman: The Dark Knight, ‘The night is darkest just before the dawn. And I promise you, the dawn is coming’

Well, KAPOW!, not just one vaccine, but three arrived in the month, sending equity markets soaring and generating their highest monthly return since 1980. The FTSE 100 shot up 5% on the day Pfizer/BioNTech announced they were the first to create a working vaccine. It was truly lovely that the married couple who founded the German biotech firm that led the breakthrough, Professor Sahin and Dr Türeci, celebrated their magnum opus with a cup of tea. A remarkable triumph of human achievement for a process that should normally take seven or eight years, yet only took nine months. Following swiftly behind, Moderna and Oxford University/AstraZeneca, with the most economic and practical vaccine, allowed us all to believe that as Harvey Dent predicted, ‘the dawn is coming’.

The FTSE 100 ended the month up 12.4% (year to date the index is still down 17%). The mood among risk assets changed to the benefit of more cyclical and ‘value’ plays; the banks and consumer discretionary businesses sharply rallied. Another core component of the UK market, the oil majors, also jumped as the brent oil price rose 25% on the month.

Internationally, but still affecting the global UK listed businesses that are our cornerstones, the US election yielded a victory for President Elect Joe Biden, although we are still awaiting the incumbent to concede. We hope that the great ideals of the US Constitution shine through and that we can see some dignity and humility before the change of Commander-in-Chief.

Markets hate uncertainty and with the US election completed and coronavirus vaccines on the way, we have two uncertainties out of the way and now await the outcome of what the UK’s future relationship with the EU will look like come the 1 January 2021… let’s hope that all parties, in the words of the great Scots poet, Rabbie Burns, will ‘take a cup o’kindness yet, for days of auld lang syne’.

Wishing everyone a very Merry Christmas and a Happy New Year.

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