What we’re tracking on 2 November 2020
Good morning, friends. It’s one of those “in between” days in which most folks’ thoughts will naturally gravitate across the Atlantic as voters in the United States prepare to head to the polls tomorrow to decide whether Agent Orange gets another four years in office.
What are the pre-election day polls telling us? Joe Biden has a huge 10-point lead in the latest Wall Street Journal/NBC News nationwide poll, which puts him at 52% to Trump’s 42%. The former vice president also has a lead in four of the most crucial swing states, according to a New York Times/Siena College poll, which has him at +3% in Florida, +6% in Arizona and Pennsylvania and +11% in Trump’s former heartland of Wisconsin.
Pennsylvania may well be the key to the White House: With more electoral college votes than any other battleground state except Florida, both campaigns are piling resources into a last-ditch effort to swing the state in their favor, the New York Times says. While Biden focuses his energy on the Keystone State, Trump is on a two-day campaign blitz, holding over 10 rallies across seven states.
There’s a good chance we’re not going to know who won on election night. The surge in the use of mail-in ballots will mean the vote count takes longer than usual and it could be several days before a final result is announced. FiveThirtyEight has a useful breakdown of when we might see results from each state. The key to watch: When will CNN and the Associated Press call individual states.
Mail-in ballots may also lead to The Donald incorrectly declaring himself the winner on election night. One scenario now being touted by some observes suggests that it could appear Trump has triumphed after in-person votes are counted in the hours after the polls close, but as one data analytics company has suggested, the result could shift later in the week as mail-in ballots (which are used more by Democratic voters) are added to the tally.
Trump has already telegraphed a post-election legal battle, saying yesterday that he intends to take legal action to prevent ballots from being counted after election day.
Emerging-market investors are bracing for impact: The potential for a contested election is focusing the minds of emerging-market investors, many of whom had priced in a huge Democratic victory and a swift stimulus package, Bloomberg reports. EM stocks, bonds and currencies experienced their worst week in over a month last week and an equity volatility gauge spiked to its highest levels since June as concerns over the US election and rising covid cases caused a sell-off in Western markets.
Add oil prices to the list of things Gulf equities have to worry about: Stock markets in the Gulf slid yesterday as new restrictions in Europe and rising covid cases in the US heightened fears of a renewed slump in demand for oil, Reuters says. Kuwait saw the biggest losses, falling 2.1% during trading, while the Dubai bourse slid 1.6% and the Saudi and Abu Dhabi indexes both losing 0.5%.
The EGX also finished in the red yesterday, falling 0.6% during the session to leave the index down 25.1% year-to-date. Trading was 19% below the trailing 90-day average, with some EGP 911 mn worth of shares changing hands.
Asian shares were mixed at dispatch time this morning while US and European futures were pointing to a slight bounce from last week’s sell-off after Wall Street turned in its worst week since March.
The House is in recess once more so MPs can hit the campaign trail. The next House plenary session will be called to order on 15 December with the same faces reconvening for what should be the last time. Speaker Ali Abdel Aal made the announcement yesterday. Our elected representatives passed a flurry of bills yesterday before punching out to go kiss babies. We have a recap in this morning’s Speed Round, below.
Voters in Cairo, Sinai and 10 other governorates go to the polls starting this coming Wednesday. Expats registered to vote in those governorates cast ballots starting Wednesday, while voters resident in Egypt will hit the voting booths Saturday and Sunday.
Not sure where to vote? The National Election Commission has got you covered.
The new class of MPs elected in the polls that began late last month won’t be seated until at least 10 January 2021, as the current group of MPs are legally our representatives until 9 January.
First phase election results dominated the airwaves last night, as we report in Last Night’s Talk Shows, also below.
News triggers coming up in the next two weeks:
- PMI figures for October will land tomorrow;
- Foreign reserves figures should be out next week;
- Inflation data for October will be released on 10 November;
- The Central Bank of Egypt’s Monetary Policy Committee will meet to review rates on 12 November.
The Health Ministry reported 181 new covid-19 infections yesterday, up from 170 the day before. Egypt has now disclosed a total of 107,736 confirmed cases of covid-19. The ministry also reported 12 new deaths, bringing the country’s total death toll to 6,278. We now have a total of 99,555 confirmed cases that have fully recovered.
Covid vaccine production draws nearer as cases begin to rise: Clinical trials of two covid-19 vaccines have been completed in Egypt and one of them will be produced domestically alongside a Chinese vaccine, Health Minister Hala Zayed told El Hekaya’s Amr Adib last night (watch, runtime: 3:41). She added that she would meet the Chinese ambassador today to discuss issues related to production. This comes as the daily case rate begins to creep up, a trend that Zayed said was expected given that we’re heading into cooler weather (watch, runtime: 2:06) She said that 65% of the new cases have been among women who do not work outside the home and the elderly (watch, runtime: 2:03).
AstraZeneca’s covid-19 vaccine is now under accelerated review by UK regulators, a spokesperson from the British pharma company said, according to Reuters. This expedited approach could result in quicker approval for the vaccine candidate, which was recently shown to trigger an immune response in adults, raising hopes for the development of a vaccine by the end of the year. Egypt has also been in talks to import mns of doses of AstraZeneca’s vaccine.
The Eurozone is expected to fall back into contraction in the fourth quarter due to the new restrictions introduced last week. After growing by a record 12.7% in 3Q, economists polled by the Financial Times now see euro GDP falling 2.3% in 4Q, raising the spectre of a double-dip recession early in 2021.
Europe’s lockdown solidarity is starting to slip: Protests have flared in Spain and Italy over the past week as frustration builds over the handling of the coronavirus and the new restrictions introduced to curb the outbreak. Just hours after the Guardian published an alarmist “revolt is in the air” piece, the Spanish prime minister was out appealing for calm as demonstrations took place in cities across the country.
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Central banks are capitalizing on record high prices to sell gold for the first time in a decade as some come under pressure from the pandemic, Bloomberg reports. The selling has largely been spurred by Turkey and Uzbekistan, both of whom are fiscally stretched and looking to offload some of their gold reserves to plug the gaps.
Could EU bonds become a more attractive hedge than US treasuries? The EU’s record-setting USD 275 bn social bond sale this month seems to imply as much, according to Bloomberg. With another USD 1 trn in debt slated for sale by the EU in the coming years and globally held EUR reserves jumping 4% last quarter compared to a 1.9% rise in USD reserves, analysts say the EUR could see long-term gains amid record issuance and continued pessimism over the greenback.
International investors will see reduced red tape accessing China’s capital markets thanks to new measures that came into effect yesterday expediting the application process and removing restrictions on the scope of investments, the Financial Times reports. The new rules will also open up its vast onshore futures market to international investors, allowing them to hedge their positions on the stock market. Investors will also be permitted to lend their holdings of shares trading in Shanghai and Shenzhen.
Veteran British foreign correspondent Robert Fisk has died at the age of 74. The journalist and author, famous for his coverage of the Middle East, passed away at a Dublin hospital after becoming unwell on Friday, the Irish Times reports.
*** It’s Blackboard day: We have our weekly look at the business of education in Egypt, from pre-K through the highest reaches of higher ed. Blackboard appears every Monday in Enterprise in the place of our traditional industry news roundups.
In today’s issue: We take a look at a new government authority set up to accredit and oversee Egypt’s vocational education system as vocational schools set up under private-public partnerships are gathering steam.