19 March 2021

What a difference a year makes – or does it?

Has Covid-19 impacted investment markets since the start of lock down? Brian Tora gives his views.


Isn’t it remarkable how swiftly the last twelve months have flown by? Just under a year ago we were entering the first lock down as the government fought to contain the coronavirus pandemic. We were in the last stages of a massive share sell off as the likely implications for business and the economy began to sink in.  The FTSE 100 Share Index shed some 35% in just two months to late March. Now we are over a third up from the nadir, though still below the levels attained at the beginning of 2020.

And a year on news headlines continue to be dominated by the pandemic. The emphasis on what is being reported may be changing, but essentially it is how we are coping with Covid-19 that is making most of the running still. The picture, while generally improving, remains mixed, particularly with regard to the speed and nature of the vaccine roll-out. The UK and US seem to have got their acts together, in contrast to Europe where considerable confusion over the efficacy of the AstraZeneca vaccine has reigned.

Notwithstanding this, the market seems relatively calm, despite the fact that there are many unresolved issues that could well influence investor sentiment. The Budget seems to have gone down well and shares, while still well below the all-time peak of three years ago, have held up remarkably well, given the hit to the economy delivered by the pandemic. It is, of course, something of a mixed picture, with some sectors suffering hugely and others actually benefitting from the changed circumstances.

Even the pound has received something of a boost, largely as a result of our success in delivering the vaccine to our adult population, which many believe will lead to an early relaxation of Covid induced restrictions and a robust recovery in our economic fortunes. While the European Union’s decision to take legal action over the perceived breach of the Brexit agreement over Northern Ireland caused a modest brief upset, generally life has been feeling a little more comfortable.

While corporate and economic news is a bit thin on the ground at present, we have heard from the bakery chain Greggs that they expect to make a loss for the first time in their 36 year history as a listed company. Undeterred by recent tough conditions, they plan to open 100 new stores. That’s confidence for you and I hope a sign that things are getting better.

 Brian Tora, Associate

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