As 2020 draws to an end, we take a look back at 10 of the year’s most consequential headlines impacting the financial markets.

1. US-China trade deal – After more than 18 months of trade tensions, a Phase 1 trade deal was reached on 15 January 2020. The agreement requires China to increase its imports of US goods and services by at least $200 billion over two years.
2. COVID-19 is declared a pandemic – The World Health Organization (WHO) characterized COVID-19 as a pandemic on 11 March.
3. Crude oil futures turn negative in April – A historic drop occurred on 20 April when West Texas Intermediate (WTI) crude futures for May delivery fell by almost 300% to an unprecedented -US$37 per barrel.
4. Unprecedented levels of stimulus – In response to the economic damage induced by COVID-19, global central banks and policymakers rolled out unprecedented levels of stimulus. Citi analysts estimate global fiscal measures amount to US$12trn close to 12% of GDP, while rolling 12 month global asset purchases could reach US$5trn, twice the previous peak.
5. Federal Reserve cuts rates to zero –The US benchmark interest rate was brought to the zero lower bound on 15 March. The ultra-low interest rates are expected to remain until the US economy recovers from the COVID-19 downturn.
6. EU Recovery Fund – The euro hit a one and half year high of 1.1540 against the US dollar on 21 July after the European Union agreed on a 750 billion euros Recovery Fund. The unprecedented act of solidarity reduced the risk of a European break-up.
7. Fastest market decline and recovery – The Volatility Index (VIX) reached extreme levels of 85 on 18 March as financial markets reacted to the COVID-19 crisis. The S&P 500 had its fastest 30% decline in history (from 19 February to 23 March) but closed at a new record high of 3,702.25 on 8 December, rebounding 65% from March lows.
8. Dislocation in credit markets and gold – Over the first three weeks of March, US high yield spreads widened to 1,100bp, levels not seen since the global financial crisis while energy spreads reached 2,310bp, the widest in history. Gold breached record highs of US$1,700/oz on 9 March on safe haven demand, before falling almost 15% in 2 weeks to US$1,450/oz levels on market dislocation and illiquidity.
9. US Presidential elections – US national media called the election in favor of Joe Biden, as he is projected to win 306 electoral votes while Trump is projected to win 232 . It takes 270 of the 538 available to become president. Inauguration is expected to be held on January 20 2021. The State of Georgia is holding run-off Senate elections on 5 January 2021.
10. COVID-19 vaccine – The first vaccine dose was administered in the UK on 9 December. Citi analysts estimate the speed of development and release of the COVID-19 vaccine could be the quickest in human history.