Though the coronavirus pandemic is hardly over, it appears that the situation is improving at present. The world has surpassed 3 million cases of Covid-19, with the United States a home to more than a million of them. Still, most affected countries are showing signs of having reached the peak of the outbreak, which means things can begin to return to normal. The two places where the virus is rampant at the moment are Russia and Mexico.
Market sentiment has been improving due to hopes that more and more countries will reopen their economies. Germany has already allowed some businesses to reopen, while France is getting ready to end the lockdown in the second week of May. Several states in the US have also scheduled reopenings around the middle of May.
Nevertheless, it is not all good news. The World Health Organization has advised that any return to normalcy needs to happen slowly and carefully, so as to avoid a second wave of the coronavirus. This puts governments in the uncomfortable position to choose whether to prioritize the health of their people or their economy.
Furthermore, today the oil market was able to catch a break after news that oil production in the United States has dropped. This finding helped alleviate some of the stress over the States running out of storage space for oil. The WTI June futures stabilized at $13.94, while the Brent remains higher at $23.36.
Later in the day we expect a press conference by the Federal Reserve, after the conclusion of its monthly policy meeting. However, no rate adjustments or additional stimulus plans are expected for the time being. Any announcements to the contrary could weaken the US dollar.
