Monday morning briefing: Services sector slipping
The COVID-19 pandemic has severely changed the way we live. And it will, no doubt, impact the scariest night of the year, Halloween, which will likely look a lot different this year as a result of social distancing and fears of the virus. Not only will it affect children, it will also impact adults, who often hold Halloween parties. It also means the usual pick-up in Halloween sales for retailers may not be as robust as in past years.
Sales of candy, along with costumes for Darth Vader, Princesses and Spiderman, will be down. Market researcher Numerator found that 48% fewer households will be handing out candy this year in the U.S. Lower sales will also impact the manufacturers of candy products, along with costume manufacturers. The expected drop in Halloween sales will negatively impact businesses, up and down the supply chain.
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Chart of the week: Services sector slipping
The European services sector weakened in October, according to a preliminary estimate from IHS Markit. This marked the second straight month the sector contracted. Coming out of the lockdowns, the services sector had surged higher, but a second wave of COVID-19 cases, and more restrictions in response, has put pressure on the sector.
Of notable concern was a significant drop in expectations for business conditions over the next 12 months. While the manufacturing sector continues to expand at a robust pace, the services sector could dampen the recovery in Europe. Let us know what you think.
Used with permission of Bloomberg Finance L.P.
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