Weekly Feed5 Mins Read
Kristal Weekly Feed | 13th April 2020
These are tough times and it can get difficult to understand and analyze major events around the globe and how they affect your investments. In our weekly market update, we help you slice and dice the latest news updates to make informed investment decisions.
Headlines this week:
- This week, the number of confirmed Covid-19 cases crossed the 1.6 million mark as global markets see-sawed between fears and hopes over the pandemic.
- Overall, while the investor sentiment was optimistic as the virus seemed to be slowing its spread, concerns about the end of the pandemic being a long way off kept the markets in check.
- In the US, all three major indices recorded one of their biggest weekly gains.
- European markets had a good week too as the number of new cases and deaths due to coronavirus appeared to have reduced.
- In the Asia Pacific region, markets remained volatile. However, most indices posted weekly gains.
Covid-19 now has 16,53,204 confirmed cases around the globe and the death toll is at 105,088.
How did the week start?:
- United States: This was a good week for the markets in the US. The markets had a disappointing last week and rebounded strongly with all three major indices closing more than 7% higher. The number of coronavirus cases in the US seemed to be stabilizing boosting investor sentiment.
- Europe: The sentiment in the US was replicated across the European region too with most markets closing higher in the region. The pan-European Stoxx 600 gained 3.73%.
- Asia-Pacific: Markets in the Asia Pacific region also had a good start to the week with most markets closing in the green. Markets responded to the hope that the lockdowns might get lifted soon due to a slowdown in coronavirus cases.
The US markets started the week on a high with the DOW closing 7.73% higher, S&P 500 closing 7.03% higher, and the Nasdaq Composite closing 7.73% higher. This was the best day in the markets since 24th March. In the US, the number of new coronavirus cases seemed to be stabilizing leading to optimism in the markets. There was a small pull-back on Tuesday due to the decline in the prices of crude oil. On Wednesday, the markets bounced back again amidst hopes that the markets would open sooner than expected. Further, the withdrawal of the Democratic candidate from the presidential race also lifted the market sentiment. In a week shortened by the market holiday on Friday on account of Good Friday, Thursday saw the markets end the week on a high. The US Federal Reserve released another program to boost the economy injecting optimism in the markets. The S&P 500 surged 12.1% and posted its best week since 1974, the DOW surged more than 12% and the Nasdaq Composite jumped 10.6% to post some record gains too.
European markets reacted optimistically to the decrease in the number of new cases in the region. Italy, Spain, and Germany showed a decline in the number of new cases for the third day in the row. Most major indices closed in the green. The hope of seeing a plateau in the number of new coronavirus cases managed to keep the markets in the green on Tuesday too. By Wednesday, the optimism started wearing off as the end to the outbreak still seemed some way off. By Thursday, European markets received a boost again as news about the Fed implementing a $2.3 trillion stimulus package cushioned the news of the latest US jobless data. Markets were closed on Friday on the occasion of Good Friday. Overall, the week ended on a positive note for most indices in the region.
In the Asia Pacific region, most markets closed higher on Monday amidst hopes that the flattening of the pandemic curve might result in the lockdowns easing up sooner. While the markets in China and Thailand were shut on Monday, most major indices in the region closed higher. The market remained optimistic on Tuesday as investors continued remaining hopeful due to the slowing of the spread of the virus. Chinese markets returned to trade and closed in the green. Markets were responding to the slowing down in the number of new cases in the US and the decrease in the number of deaths in countries like Italy, Spain, etc. The optimism started wearing off by Wednesday as most countries in the Asia Pacific introduced new measures to control the pandemic. Thursday was a mixed day as the market sentiment kept shifting between optimism and fear of the economic impact of the virus. While some markets were open on Friday, the indices had a mixed end to the week. Overall, it was a better week for the markets as compared to last week in the Asia Pacific region.
Heading into next week…
As investors around the globe continue to grapple with the numbers surrounding the pandemic, the stimulus measures and the social distancing measures, markets have been struggling too. There was some hope this week that the curve might finally be flattening but investors remained watchful as every day brought new updates on the spread. In the coming weeks, if the reduction in the number of new cases and deaths due to the virus continues, then investors might feel optimistic enough to start looking at market segments that might benefit first when economies return to business. Our recommendation – remain watchful and strategize your investments carefully.
The materials and data contained herein are for information only and shall in no event be construed as an offer to purchase or sell or the solicitation of an offer to purchase or sell any securities in any jurisdiction. Kristal Advisors does not make any representation, undertaking, warranty or guarantee as to the update, completeness, correctness, reliability or accuracy of the materials and data herein. All opinions, forecasts or estimation expressed herein are subject to change without prior notice. Kristal Advisors and its affiliates accept no liability or responsibility whatsoever for any direct or consequential loss and/or damages arising out of or in relation to any use of opinions, forecasts, materials and data contained herein or otherwise arising in connection therewith.
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