Market Report 28th February 2020

Market Report 28th February 2020 981 980 Realm

Markets ended lower for a fifth straight day as fears of the coronavirus becoming a pandemic made investors flee riskier assets. This week, so far, rising fears of a pandemic have wiped out more than $3 trillion in value from global stock markets.

  • European stocks ended with sharp losses on Thursday as stocks crashed on massive selling amid coronavirus jitters. The rapid spread of the dreaded coronavirus has raised concerns about the outlook for the global economy and rendered the mood bearish once again.
  • US stocks attempted to recover from early sell-off during trading on Thursday but pulled back once again to end the session sharply lower. The major averages closed lower for the sixth straight session, with the Dow tumbling to its lowest closing level in six months.
  • Asian stocks finished broadly lower as investors fretted about the coronavirus outbreak turning into a worldwide pandemic. The further spread of the coronavirus outside China raised concerns about the impact of supply and demand disruptions.

Global Macro

  • China’s central bank said that it will ensure ample liquidity through targeted reserve requirement ratio (RRR) cuts for banks at an appropriate time, and will keep monetary policy prudent and flexible to support the economy. China has announced a flurry of steps in recent weeks to shore up investor confidence and help keep smaller businesses afloat as the coronavirus epidemic severely disrupts economic activity.
  • The Eurozone economic sentiment indicator rose 0.9 points from a month earlier to 103.5 in February 2020, the highest since last May and above market expectations of 102.8. Confidence improved among manufacturers (-6.1 vs -7.0 in January), service providers (11.2 vs 11.0) and consumers (-6.6 vs -8.1), while a morale deterioration was seen among retailers (-0.2 vs -0.1) and constructors (5.3 vs 5.8). Euro Area Economic Sentiment Indicator – data, historical chart, and calendar of releases – was last updated on February of 2020 from its official source.
  • The GfK consumer confidence in the United Kingdom rose 2 points to -7 in February 2020, climbing for the third consecutive month after reaching its lowest level since 2013 in October and November ahead of the election. The general economic situation of the country during the last 12 months climbed 5 points to -23, while expectations for the general economic situation over the next 12 months gained 3 points to -21. The improvement fails to capture the incipient impact of the coronavirus landing in Europe, likely to weigh on sentiment ahead as hundreds of patients are currently being tested in the UK. “Although the Index remains south of positive, the trajectory remains upwards.

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