On Monday, the Asian markets posted new drops as the news of the spread of Coronavirus is constantly on the rise. Some of the top Asian indices performed in this way thus far-
- Japan’s Nikkei dropped 3.7%
- Hong Kong’s Hang Sang Index lost 1.9%
- China’s Shanghai Composite Index posted a loss of 1.4%
It isn’t only the Asian market that’s dropping but the US market that declined on Friday after the massive stock market rally last week also doesn’t seem positive. On Sunday night, the US Stock futures were lower and the market continues to give on all the gains it had made in the last week. The DOW futures were down by 220 points or a 1% while the S&P 500 future fell by 1. 1%. The Nasdaq futures weren’t far behind as they too hint at a fall of around 1% on the trading hours of Monday.
As a result of reduced demand and the price war between Saudi Arabia and Russia, the price of oil is constantly dropping. The Brent Crude futures, which is the global benchmark for oil, were down by 5.8% and the last trading price was around $23.50/ barrel.
According to experts, the downward trend in the stock futures right at the beginning of the week showcases the fact that the rally in the stock market in such a bearish market won’t last long. This is majorly because of the constant slowdown of the economy due to the spread of
the Coronavirus pandemic.
Last week, there was a point when the DOW gained back around 20% and emerged out of the bear market which in itself is a record. It was due to the efforts of the central banks and lawmakers around the globe to offer fiscal stimulus that would hold the economy upward.
The Coronavirus continues to spread throughout the world and apart from lives; it also threatens corporate earnings, travel, businesses, and jobs. This is further proved with the spike in the number of US Jobless claims to take it as high as 3.28 million. This is the highest number of jobless claims as of yet in the history of the nation! Trump announced that the social distancing in the country will be further extended to April 30. The expected recovery date for the country is set by June 1 and everyone hopes to see the light at the end of the tunnel this time.