Global Markets Update Monday, 16 March 2020
16 Mar 2020
The World Health Organization declared the coronavirus outbreak a pandemic, saying that Europe was now the “epicentre” of the crisis. While cases surged in Europe, the number of reported cases in China continued to drop, with more cases being imported from arrivals from outside of China compared to transmission within China.
Global stockmarkets plunged, with most markets entering an official bear market (defined as a decline of at least 20% from a recent peak) after President Trump banned visitors from most European countries to the US. US and UK stock suffered their steepest daily falls since “Black Monday” in 1987, while European stocks saw the largest daily falls on record. Continued sharp falls in the oil price also added to global stocks’ woes. Unusually government bonds failed to provide a safe haven as stock markets tumbled, with yields rising over the week.
Global Markets Update Monday, 9 March 2020
09 Mar 2020
Global stocks started a volatile week strongly but suffered steep declines towards the end of the week amid growing fears that the coronavirus outbreak would lead to a global recession. Central banks across the world reduced interest rates, led by the Federal Reserve, and governments announced measures to help counter the impact of the coronavirus outbreak. Policymakers from the G7 countries also pledged action.
Makers of household staples, disinfectants and video games have all bucked the sell off as people prepare for possible self-isolation.
Global Markets Update Monday, 2 March 2020
02 Mar 2020
Global stocks plunged, suffering their worst one-day sell-off in two years, on news of several significant coronavirus outbreaks outside of China. The sharp rise in cases in Iran and Italy, as well as the existing outbreak in South Korea, meant that for the first time more new cases were reported outside of China than within China. Most markets are now in a technical correction, having fallen at least 10% from their recent peaks in January. Indeed, the FTSE All-World lost almost 13% over the week, wiping out six months of gains and lopping nearly $6tn off the value of global equities.
Airlines and travel firms were among the worst performers, and financial stocks were also hit badly by a sharp drop in longer term bond yields.
Global Markets Update Monday, 24 February 2020
24 Feb 2020
Global stocks retreated as the coronavirus continued to spread beyond China and evidence started to emerge of its impact on company profits: airlines warning they stand to lose $29.3bn of revenue this year due to the coronavirus outbreak, car manufacturers facing closure due to parts shortages and tech companies also worried about the impact on their supply chains.
Global Markets Update Monday, 17 February 2020
17 Feb 2020
Global stocks rose modestly amid hopes that the coronavirus outbreak would be relatively mild in the US and Europe.
The US administration announced it would raise tariffs on plane imports from 10-15%, but decided against raising the 25% levies it has also put in place on a wide range of European and British goods, ranging from food to tools and apparel.
Global Markets Update Monday, 10 February 2020
10 Feb 2020
Global equities ended January on a weak note as the coronavirus outbreak spread, causing countries to shut borders and impose quarantine restrictions on visitors arriving from mainland China. However, stocks bounced in early February on news that China was to halve tariffs on some US imports. Measures taken by the People’s Bank of China to help the economy combat the fallout from the virus also helped boost risk sentiment.
The extended shutdown of Chinese factories started to impact the global supply chain. Toyota, Hyundai, Volvo and PSA, the owner of Peugeot, warned that coronavirus is disrupting their supply chains, while Fiat Chrysler warned that one of its European plants will be forced to halt production in a matter of weeks. Disruption was also expected to the global technology supply chain.
Global Markets Update Monday 27 January 2020
27 Jan 2020
Global stocks retreated as confirmed cases of the coronavirus surged and the outbreak spread outside China. At the start of the Lunar New Year period, which normally sees millions of people travelling to visit families, several Chinese cities have imposed significant travel restrictions, while Wuhan, the source of the outbreak, is in effective lockdown.
The US threatened to impose tariffs on UK car exports if the UK pushes ahead with plans for a digital services tax in April – during the week, France offered to defer its plans for digital tax. The EU and US also clashed over EU proposals for a carbon tax.
Global Markets Update Monday, 20 January 2020
21 Jan 2020
Global stocks rallied, the MSCI World Index hitting a new peak, with sentiment lifted by news that the US and China had signed a “phase one” trade deal. In the agreement, China has pledged to boost US imports by $200bn above 2017 levels and strengthen intellectual property rules, while the US has agreed to halve some of the new tariffs it has imposed on Chinese products. While the Trump administration also removed its designation of China as a “currency manipulator”, the majority of US tariffs on Chinese goods remain in place.
Global Markets Update Monday, 13 January 2020
13 Jan 2020
Developments in the Middle East caused global stocks to remain nervous, as Iran fired missiles at US bases in Iraq in retaliation for a US drone strike that killed Qassem Soleimani, head of Iran’s elite Quds force. However, tensions appeared to ease as the weak progressed, with Iran admitting it had erroneously fired a missile that downed a Ukrainian passenger jet. Stocks were also cheered by the prospect that the US/China “phase one” deal would be signed next week.
Global Markets Update - Monday, 6 January 2020
06 Jan 2020
The FTSE All-World Index rose 24% over 2019, its best year since 2009. US stocks closed 2019 with their strongest annual gains since 2013. European shares rose 26% over the year, their largest annual gains since the introduction of the euro in 1999. In the UK, the FTSE 100 of larger companies recorded its biggest annual gains since 2016, while the FTSE 250, seen as a better reflection of the UK economy, surged 25% for the year in its best performance since 2013. Chinese stocks ended the year over 34% higher, their best run since 2014, while Australian stocks recorded their strongest annual gain since 2009, rising 18% over the year.