Market Outlook

Before the Easter holiday, the financial market sentiment improved, as the Fed announced another $2.3 trillion economic stimulus plan, coupled with the expectation that OPEC+ could reach the production cut agreement, supporting Wall Street to further test the recent highs. However, after the holiday, optimism faded again. The Dow fell more than 1% on Monday (April 13), but the Nasdaq rose for three consecutive trading days.

On Wednesday (April 8), market sentiment was lifted again due to the supportive news. Investors become active to move back into risky assets. Wall Street ’s three major indexes rose, of which the Dow and S&P 500 rose more than 3%. The overall market trend is choppy, mostly dominated by the sentiment. The White House health advisor Fauci said on Wednesday that the US coronavirus outbreak situation should be improved next week, and President Trump also pointed out that the reopen of US economy will only be faster. Also, the announcement of Sanders ’withdrawal eliminated some uncertainties. All those news turned the market to be more bullish.

On Tuesday (April 7), risk appetite once dominated the financial market. However, investors worried about OPEC+ meeting this week regarding the production cut. The uncertainty triggered risk aversion, and the Wall Street’s three major indexes fell from the top at Tuesday’s opening, which the Dow once rose more than 900 points. Eventually, the three major indexes all closed slightly lower.

On Monday (April 6), the market sentiment improved significantly, as the data shows that the trend of the pandemic in Europe and the US is slowing down, boosting the investor confidence. Risky assets were benefited due to the risk appetite, and the three Wall Street indexes all rose 7%. At the beginning of Monday’s opening, US President Trump said that seeing signs of the coronavirus outbreak in the United States has begun to level off. Market sentiment turned much better and the stock markets in the Asia-Pacific region were generally good. The uptrend was finally maintained in the US trading session.

Last Friday (April 3), the non-farm payroll in US was far worse than the market expectations, further confirming that the US job market has been severely hit by the global pandemic. The market sentiment once again became bearish. The three major Wall Street indexes all fell more than 1.5%. Oil prices rebounded further, the financial market got a slight boost earlier on Friday. However, the global pandemic of new coronavirus has not been under controlled, and the number of confirmed cases and deaths continue to soar, increasing investors ’worries.

On Thursday (April 2), the employment figure released by the United States scared investors, but then a positive news from the oil market boosted market confidence. Investors is expecting a truce in the price war between Saudi Arabia and Russia. The three major Wall Street indexes were still up, which the Dow and S&P both gained more than 2%, under the fears of new coronavirus pandemic.

On Wednesday (April 1), the three major Wall Street indexes plunged again, all fell more than 4%, even if the economic figures performed better than expected. Investors are worried that the coronavirus will keep the economy shut down longer than expected. US President Trump has warned that the next two weeks will be “very painful” and the situation will worsen, calling on the public to be prepared. The White House recently predicted 100000 to 240000 deaths in US even with the current strict social distancing measures. The market is expected that the pandemic will not be under controlled in the short term, increasing the pressure on the stock market.

On Tuesday (March 31), investor sentiment became cautious again. With the bullish news, the three major Wall Street indexes all fell, which the Dow lost more than 400 points, closed 1.84% lower. It is reported that the US government are drafting a new economic stimulus plan to deal with the impact of the US economy hit by the epidemic. Trump administration may defer tariffs for most-favored nations for 3 months on some imported goods, and will be announced in the form of executive order as soon as this week. However, the news has limited stimulus effect to the market sentiment.

On Monday (March 30), the financial market sentiment was lifted after some “good” news came out in the US session time. Investor confidence was stabilized, stimulating the three Wall Street indexes to rise, more than 3%. Trump said that the national social distancing guidelines will be extended to April 30, which lowered the market concerns about the epidemic causing long term damage to the economy.

On Friday (March 27), risk appetite in the financial market has changed. After three days strong move, the three major Wall Street indexes all fell, of which the Dow fell more than 4%. However, throughout the week, the Dow rose 12.8%, the biggest weekly gain since 1938. Even though the US House of Representatives passed the $2 trillion economic stimulus plan, it failed to further support the market sentiment.