Without a doubt, the coronavirus remains the hottest topic in the markets today due to its vast impact on everything from politics to economics.
The number of cases worldwide now exceeds 43.4 million. The United States is home to roughly 8.9 million Covid-19 cases, India has 7.9 million, and Brazil remains third with 5.3 million.
The US confirmed another 60,000 cases yesterday, which is lower than last week’s spike to over 85,000 in one day, but on average it is higher than the previous weeks, indicating that the outbreak in the United States is getting worse once more. This is also confirmed by the spike in hospitalizations and deaths.
The pandemic is getting worse in Europe as well. France saw its highest daily increase yesterday, confirming over 52,000 new Covid-19 cases. Italy, Germany, Spain, the Netherlands, and Belgium also remain problematic. The same can be said of non-EU members such as the United Kingdom and Russia.
The prospect of more lockdowns and travel bans is depressing the markets, since investors now expect not just a slow recovery, but a secondary recession, depending on how strict the methods of limiting the spread of the virus get. Italy is taking a page out of the UK’s book and closing bars and restaurants early to keep people out of the streets. Meanwhile, Spain announced a state of emergency.
Sentiment is not helped at all by the stalemate in the United States, where Congress has still not agreed on a stimulus bill.
Unsurprisingly, stock indices are quite depressed today and will likely continue to trade lower, at least until a robust earnings report revives them. The Dow Jones, S&P 500, and Nasdaq 100 all took a loss early on in the day. The outlook is similar in Europe.
To make matters worse, the US-China tension is once again ramping up. China has decided to impose sanctions on US companies like Boeing in retaliation for the military help the US recently offered Taiwan (whose independence China does not recognize).
