Shares edged higher almost everywhere in the world today. European markets echoed the bullish trends registered overnight in Asia while all US benchmarks are also pointing to a firm open. This renewed appetite for risk assets comes after good news from China where the rate of the spread of the coronavirus, with less deaths and infections than yesterday, was now decreasing. Market sentiment is being significantly boosted as most investors and analysts now expects the impact of the deadly flu on economies to be short-lived and contained within Q1. In addition, the end of the crisis may be in sight after a South Korean patient successfully recovered using anti-HIV medication while Chinese authorities announced a vaccine could be ready in 12 to 18 months. An air of relief is now blowing over share markets around the world with traders also welcoming the way China handled the crisis financially with its cash injections, and this has helped keep market confidence in place.
In the meantime, Jerome Powell provided a mixed tone yesterday by stating that the US economy is in a good place but that downside risks to growth, despite having diminished, still exist.
Photo by Neonbrand.
Retailers and automakers are among the best performers in the eurozone, but all sectors are also trading higher. The DAX-30 Index is today’s top mover in Europe with the market trading over 13,700pts for the first time in its history. However, the technical configuration isn’t very reassuring as prices are still evolving inside a broadening formation pattern that typically points to growing uncertainty and therefore raises the potential for a trend reversal or deep market correction.
