In the volatile Covid-19 marketplace traders are focused on metrics never used before, they are watching the death toll in hot spot cities in the US. They are also watching Spanish cases of the Cornonavirus as an indicator that spread from Italy and trying to determine if these are peaking. Traders and investors in New York (and other global trading hubs ) now have something to gauge which is reducing the swings. It is really amazing to watch as 5-10% moves have become the norm for these Covid-19 markets.
The Dow Jones was 7% higher at the time of writing, click here to see the latest quote. These are back to back days where buyers are showing up with aggressive bids. As we head into midweek, many are looking for a Good Friday rally and a general sense of relief as we head to the Easter Holiday.
“Increasing hope that fatality rates for Covid-19 may well be starting to plateau in Europe saw strong gains across the board, after Spain, Italy and France reported sustained dips in the death rates in their respective countries,” said Michael Hewson, the chief market analyst at CMC Markets UK.
“We also saw the announcement of a variety of new measures to cushion the economic effects of the virus,” said Hewson, pointing to moves in Japan, Singapore, Spain, and Germany, where there are discussions about a “limitless” credit facility for small companies.
Finance ministers from the eurozone are meanwhile set to meet on Tuesday to discuss co-ordinated proposals to deal with the fiscal costs of the pandemic. The strong opening in Europe followed gains for stocks in Asia. Futures are pointing to a higher open for US stocks on Tuesday.
“Optimism on the direction of equity markets will be difficult to maintain until we see more clarity on the corporate earnings outlook and until the dispersion of analysts’ forecasts subsides,” Marija Veitmane, a multi-asset strategist at State Street Global Markets.