On Wednesday (March 11), the market remained uncertain, the three major Wall Street indexes plunged sharply, which the Dow fell by 5.86%, more than 1,400 points, erased all Tuesday’s gains. The WHO officially announced the new coronavirus (COVID-19) as a “global pandemic”, once again hit the market sentiment. Also, there has no further details about the Trump’s policies, triggering market disturbing.
After another “Black Monday”, investors are paying close attention to the news of the OPEC and Trump’s policies. The trend of various markets such as gold and forex still very uncertain. So far investors were not sure about the details of Trump’s policies, but it was reported that Trump might lower income tax rate to 0%, which caused strong buying in the market. The three major Wall Street indexes rebounded and all rose nearly 5% to close, including the Dow rising more than 1,000 points.
On Monday (March 9), investors witnessed history again. Due to the breakdown of production reduction agreement negotiations between OPEC and Russia, Saudi Arabia announced an extreme move over the weekend. Oil prices continued to drop sharply following the decline of last Friday. It was once more than 30% after opening, which was the biggest drop since 1991.
Gold prices did not reflect the optimism of the market on Wednesday, but continued to show resilience as funds chased risky assets.
Signs of pneumonia outbreak or slowdown in mainland China, weakening demand for safe havens, coupled with Federal Reserve Chairman Colin Powell’s renewed confidence in the U.S. economic outlook, further reassured, as money continued to flow into the stock market, with the Dow, S.P. and Nasdaq all hit record highs.
Gold prices fell modestly on Tuesday, but the intraday volatility was relatively large, reflecting the theme of market conditions or the possibility of changes in sentiment. As investors concerned about the new confirmed cases of pneumonia, the phenomenon of slowing growth began to appear, to a certain extent to ease the financial market tension atmosphere. Risk appetite emerged on Tuesday, with money flowing back into the stock market, with the S.P. and Nasdaq hitting record highs for two consecutive sessions.
The mood in financial markets improved further, but failed to last, mainly because investors were cautious and remained on alert. Risk appetite continued to flow into the stock market, with the S. and P.P. and Nasdaq hitting record highs for two consecutive sessions, but the Dow rose and then fell, a relatively weak trend.
Gold prices did not rise much, but keep an eye on the dollar’s strength and remain hovering around $1,570, which is already relatively strong, meaning higher against other non-US currencies. Even as the stock market stabilised on Monday, investors remained cautious, taking in safe-haven assets at the same time, and funds did not flow out of gold and bond markets.
Financial markets stabilised, investor panic did not fester further, funds returned to the stock market, the S&P and Nasdaq hit record highs.