Once upon a time in America

Editorial The markets consolidated in scattered order this week in response to the two current forces: the renewed acceleration of the pandemic in the United States, which is worrying, and a positive macroeconomic news flow. In terms of equities, the wide dispersion (geographical/sectoral/individual) continues, with well-identified hot spots (we could say bubbles): +16% for the Chinese indices in eight sessions and Nasdaq breaking records every week. In addition to the pandemic, the wave of Q2 earnings releases that will hit the US will be a test of resilience for equities in the short term, with low expectations (on the earnings side) but hopes (on the guidance side - if they come out) as downgrades and defaults continue. Also at risk are the European Council meeting and the recovery plan to be approved. On the other hand, there is little surprise to be expected from the ECB, the BOJ and Fed spokespersons, but the macroeconomic news flow will be considerable (Chinese GDP and US retail sales in particular).