1. Good economic & Covid news

The Treasurer does a show-and-tell on the course of the Budget and it’s good news, with the projected deficit expected to be smaller and our economic growth bigger. And Deloitte Access Economics says the outlook for the jobless looks better than was predicted. Success in handling the Coronavirus has delivered these economic dividends. And then there has been China’s demand for our iron ore, which has been pushed to historically high levels over US$152 a tonne, but the Budget used a forecast of only US$55, which gives the Treasurer a tax windfall and a lower Budget number. As iron ore companies like BHP pay a lot of tax, we have a perfect storm of good economic and COVID-19 news!

2. Good news to extend to house prices, the stock market and our super funds

The AFR reports that a respected fixed income fund manager, Chris Rands at Nikko Asset Management says house prices look set to be up, wait for it, 10-15% next year. This was similar to the house price predictions of Chris Joye of Coolabah Capital, whose calls this year have been better than most market experts. This follows the huge US investment bank Goldman Sachs, which last week tipped stock prices on Wall Street are tipped to be up 16%. And we play follow the leader with the US market, so it augurs well for our super funds that not only invest in local stocks but have a big exposure to US shares. 

3. Only in America!

While Coronavirus cases going over 200,000 a day is shocking, the US stock market is concerned that the squabble over the stimulus package between the Democrats and the Republicans is making the economy sicker than it needs to be. Congress did extend funding for a week on Friday, hopefully to get an agreement before Christmas, which means public servants won’t be sent home as government departments were set to close because of a lack of money! Only in a America!

4. EU and UK to "go the extra mile"

Trade talks between the EU and the UK are set to continue beyond the previous deadline of last Sunday "despite the exhaustion after almost a year of negotiations" European Commission President Ursula von der Leyen and UK Prime Minister Boris Johnson said in a joint statement. The transition period following the UK's exit from the EU is still set to close at the end of 2020.

5. US stocks close lower for the week

After two consecutive positive weeks for the Dow Jones and S&P 500, and three consecutive up weeks for the Nasdaq, all three indexes ended last week down. The S&P was the hardest hit, falling 0.96% for the week to 3,663.46, followed by the Nasdaq which fell 0.69% to 12,377.87 and the Dow Jones which was down 0.57% to 30,046.37.