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Today's markets: Green list green light? US infrastructure deal & more

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Today's markets: Green list green light? US infrastructure deal & more

 

  • Green list update overshadowed by concerns EU may impose its own quarantine rules on UK visitors
  • Wall Street stocks set new high
  • Nike results impress

Green list updated but EU quarantines could cause complications

The government updated its travel ‘green list’ yesterday, adding Malta, Madeira, the Balearic Islands and Barbados as destinations where travellers do not need to quarantine. The changes will take effect from 4am on 30 June.

Transport secretary Grant Shapps also said that “later in the summer” the government is planning to drop quarantine requirements for fully vaccinated people travelling from countries on the ‘amber list’. This is expected to occur in phases, starting with UK residents returning from abroad rather than foreign tourists. Further details will be provided next month.

But European summer holidays could be facing more complications as German Chancellor Angela Merkel is calling for EU countries to require travellers from the UK to quarantine to slow the spread of the Delta variant. Merkel told the German parliament that “[i]n our country, if you come from Great Britain, you have to go into quarantine – and that's not the case in every European country, and that's what I would like to see.”

Her proposal is backed by French president Emmanuel Macron, who says that “[a]bove all we have to be very coordinated.”

The travel industry’s reaction to the updated green list has been mixed.

Heathrow boss John Holland-Kaye said that “[i]t is very positive news that ministers are following the science and that fully vaccinated people will be able to travel safely without quarantine later this summer.”

But easyJet (EZJ) chief executive Johan Lundgren says that “this is still not the safe and sustainable reopening of travel the government promised…With two thirds of UK adults expected to be double jabbed by 19 July, now is the time to let British citizens take advantage of the success of the vaccination programme.”

Bipartisan infrastructure deals sends S&P 500 to new record high

Flanked by a group of Republican and Democratic senators, President Biden announced yesterday that a deal has finally been reached on an infrastructure spending package. The bipartisan agreement entails around $1bn (£720m) of investment over the next eight years – of which $579m is new spending – although it is some way short of Biden’s original $2.3 trillion American Jobs Plan.

“Let me be clear: neither side got everything they wanted in this deal, and that’s what it means to compromise,” Biden said yesterday.

The new proposal is rather light on details, but it includes $109bn of spending on roads and bridges, $65bn on broadband infrastructure and $73bn on updating the country’s ageing power grid.

Part of the deadlock on infrastructure has been how to fund such high levels of investment, with Republicans vehemently opposed to higher corporation taxes. The bipartisan plan involves a series of measures to raise revenue, such as increasing the Internal Revenue Service’s (IRS) capacity to enforce tax laws.

While the deal currently has the backing of 21 senators from across both aisles, there are still doubts over whether it can achieve the requisite 60 votes. Some Democrats would like assurances that the rest of Biden’s ambitious spending plans will be pursued through the reconciliation process that only requires a simple majority in the Senate.

House of Representatives leader Nancy Pelosi said yesterday that “we will not take up a bill in the House until the Senate passes the bipartisan bill and a reconciliation bill.”

Despite the uncertainty ahead, Wall Street was encouraged by the progress made. The S&P 500 climbed by 0.6 per cent yesterday, reaching a new high of $4,266.

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