China’s markets are well. it is fear of coronavirus that drives the world’s economy into a false perceived sense of a global recession that does not exist, people! Fear moves volatility in market spreads more than facts themselves….There is no known cure for fear other than the old adage that says : GROWN SOME BALLS! For everything else, there’s an app for that! ahahahahahhahahaa
Global markets head for worst week since the world financial crisis of 2008
Global share prices headed for the worst week since the darkest days of the world financial crisis in 2008 as investors braced for the coronavirus to become a pandemic and rapidly spread around the world.
Virus fears ‘have become full-blown across the globe as cases outside China climb,’ Chang Wei Liang and Eugene Leow of DBS said in a report.
In Europe, London’s FTSE 100 sank 2.9% to 6,599 and Frankfurt’s DAX tumbled 3.3% to 11,955. France’s CAC 40 lost 2.7% to 5,346. The Stoxx Europe 600 index is heading for its sharpest weekly drop since October 2008.
Markets in China and Hong Kong had been doing relatively well despite virus fears. Mainland markets were flooded with credit by authorities to shore up prices after trading resumed following an extended Lunar New Year holiday. Chinese investor sentiment also has been buoyed by promises of lower interest rates, tax breaks and other aid to help revive manufacturing and other industries.
But now, major companies are issuing profit warnings, saying factory shutdowns in China are disrupting supply chains. They say travel bans and other anti-disease measures are hurting sales in China, an increasingly vital consumer market
Hopes that the epidemic that started in China would be over in a few months and economic activity would return to normal have been shattered, as new infections reported around the world now surpass those in China.
‘The coronavirus now looks like a pandemic. Markets can cope even if there is big risk as long as we can see the end of the tunnel,’ said Norihiro Fujito, chief investment strategist at Mitsubishi UFJ Morgan Stanley Securities. ‘But at the moment, no one can tell how long this will last and how severe it will get.’
MSCI all country world index fell 3.3% on Thursday to bring its losses so far this week to 8.8%, on course for its biggest weekly decline since a 9.8% plunge in November 2008.
Wall Street shares led the rout as the S&P 500 fell 4.42%, its largest percentage drop since August 2011.
It has lost 12% since hitting a record close on Feb. 19, marking its fastest correction ever in just six trading days while the Dow Jones Industrial Average fell 1,190.95 points, its biggest points drop ever.
In Asia, Australian shares dropped 2.8% to a six-month low while futures suggested Japan’s Nikkei is on course to fall more than 2%.
Fears of a major economic slump sent oil prices to their lowest level in more than a year. U.S. crude futures fell to $46.28 per barrel.
As investors flocked to the safety of high-grade bonds, U.S. bond yields have plunged, with the benchmark 10-year notes yield hitting a record low of 1.241%. It last stood at 1.274% .
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Sources : Bloomberg and Intelprise