- The rate of increase globally in fatalities and new confirmed infections from the coronavirus pandemic continues to increase exponentially, with its epicenter now located in New York. A world recession or possibly even depression appears to be inevitable, with Goldman Sachs forecasting a 34% drop in U.S. Q2 annualized GDP and other analysts seeing a 30% unemployment rate in the near future. If correct, these will be the worst such numbers seen since the 1930s, but it should be noted many analysts continue to see a much better outlook for U.S. unemployment. The WTO has forecasted that global trade is set to fall by one third.
- Despite the gloomy global economic outlook, stock markets (especially in the U.S.A.) are still rising, and other risky assets continue to rise. Major U.S. stock indices have regained almost half of the value lost during its recent fall from peak to low – exceeding this would be technically significant. Many analysts think the bottom of this bear market has already been reached, but other analysts see further strong falls likely in stocks over the coming weeks and months. There is a strong divergence of opinion.
- The Prime Minister of the United Kingdom, Boris Johnson, remains stable in an intensive care unit after being hospitalized Sunday due to persistent coronavirus symptoms. He is not requiring ventilation. He tested positive for the virus 13 days ago.
- The rate of increase in new confirmed cases seems to have peaked in the hard-hit European nations of Italy and Spain, but deaths are still rising in France and Germany. Death rates (but not new infections) still seem to be increasing exponentially in the U.S.A. and in the U.K, with both nations suffering their highest daily death tolls yet. Some forecasters are starting to see the U.K. as likely to end this wave with the highest death toll in Europe. The strongest growth of the virus in the world now is happening in New York City and New York State, with the U.S.A. now leading the world in number of confirmed cases (almost one third of the global total), and having had almost 15,000 deaths so far. Even in Germany, the death rate to confirmed infections has risen to almost 2%. The U.S.A., Italy, Spain and Germany all have had over 100,000 confirmed cases.
- The price of Gold looks like it peaked have peaked when it approached the $1680 area near its recent multi-year high price.
- WTI Crude Oil appears to be set to recover further on news that an oil production deal looks increasingly likely to happen after selling off earlier this week, following its recovery last week from its recent sharp fall to an 18-year low below $20.
- Currency markets are currently dominated by relative strength in the U.S. Dollar, while the Australian Dollar looks weak over the short term..
- Markets have been affected by high relative volatility, but this is generally decreasing, although stocks are still showing high volatility.
- There are high-impact economic data releases scheduled for today, with the European Central Bank giving its monthly policy input, and releases of U.S. and Canadian Unemployment data, so we will probably see more volatility once the New York session gets underway.