Blood Bath in Global Markets as Coronavirus Accelerates
FEBRUARY 24, 2020
The U.S. dollar is up again this morning against most of its rivals as global markets are awash in red on increased fears that the coronavirus is worsening.
European stocks have fallen as much as 4% after Italy reported a surge of infections. American futures show equities will plunge nearly 3.0% on the open in New York. The price of oil is also 4.0% lower.
This morning’s economic docket showed a slight miss for the Chicago Fed’s activity index. The Dallas Fed is due out at 10:30 a.m. The current mood in the market makes it unlikely that fundamental data will have a large impact on markets today. Instead, market participants will continue to weigh the risks of a growing global pandemic.
What to Watch Today…
- No major events scheduled for today.
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The Japanese yen rallied a half a percent overnight versus the U.S. dollar, reversing some of its steep decline against the greenback last week. The yen reached its weakest level since May last week on Japanese recession fears. But the worries over coronavirus have outshined recession worries and led the safe-haven currency to rise today.
The British pound is starting off the week on its back-foot, losing as much as half a percent to its American rival. The U.K. enjoyed mostly stronger-than-expected data last week, but that was unable to help the sterling. In fact, odds that the Bank of November will need to cut rates by 25 basis points later this year have increased. The market is currently fully pricing a cut by November.