Get the market news and latest updates around the globe with our market briefing for March 23, 2020.
– The global coronavirus pandemic continues to spread exponentially within Europe and from its epicenter in Europe, with more and more countries imposing lockdowns and restrictions which are causing very significant economic damage. A global recession appears to be inevitable, with Goldman Sachs forecasting a 23% drop in U.S. GDP. Stringent restrictions continue to be imposed in Europe and the U.S.A. New cases in hot weather countries have dented hopes that warmer weather may halt the spread.
– Fatalities in most European countries are increasing, but Italy had a lower number of deaths yesterday for the first day in a long while, providing some hope that the lockdown is beginning to show results. Confirmed cases in the U.S.A. now put it 3rd behind only China and Italy in number of cases. In the UK, there is a growing feeling that social distancing advice is so widely ignored that it may need to be imposed by force.
– The U.S. stock market’s major index, the S&P 500, declined again Friday. All stock markets have been suffering heavily and most are down by more than one third in value over just the past five weeks. The stock exchanges in France, Italy and Spain have banned short selling.
– Commodities (especially Crude Oil), commodity currencies, the Euro and the British Pound are weak. The U.S. Dollar is clearly the strongest currency by far.
– The Australian Dollar, the British Pound, WTI Crude Oil and Silver have all hit multi-year lows within recent days.
– The dominant theme in markets is very high directional volatility, and plummeting consumer demand. This provides opportunities for traders, but close monitoring of trades on short time frames is very advisable due to the strength and speed of price movements.
– The key factor in markets today will likely be how the U.S. Treasury and Administration continue to tackle the crisis, with enormous pressure building to take very drastic lockdown measures to save not only health but the economy. The U.S. Senate and Administration are currently arguing over a mooted $2 trillion stimulus / bailout package which has yet to be agreed, as New York City goes into lockdown measures.