ZFX: Second wave fears? Optimism of economic recovery dominated the markets
On Tuesday, the three major Wall Street indexes all rose, of which the DOW jumped more than 2%. The record-setting US retail sales figures, another potential $1 trillion fiscal stimulus from the White House and the positive coronavirus trial test result sparked the rally.
The US retail sales soared 17.7% in May, beating the expectation of 8%, which boosted the optimism of economic recovery.
However, on Wednesday, stock markets in Asia were just fair in performance. Investors are now continuing to weigh the potential risk of second wave of the coronavirus pandemic. The geopolitical tensions in Asia, India and North Korea, would be the one of the key concerns.
The International Monetary Fund (IMF) said that, the global economy recession may be much more severe than it previously forecasted. Fed chairman Powell also expressed a rather pessimistic views of the US economy outlook.
Overall, the investors are not that bullish so far, and turn to be cautious. The dollar is ranging these days, that up and down around 97 level.
ZFX analyst Jacob Leung said that, of course the sentiment is not pessimistic, but just very sensitive. We can see the market can change and move so fast, with no clear direction. As there are both positive and negative issues, it is expected the whole market may enter into a big range pattern.
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