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ZFX: Uncertainties fray investor nerves! Wall Street retraced
Asian stocks fell on Thursday morning following Wall street overnight. Traders were cautious as the current situation about the pandemic, coronavirus vaccine and economic recovery are becoming uncertain.
The good news from the development of coronavirus vaccine recently supported the bullish sentiment over the financial market. On Wednesday, Pfizer and BioNTech said that the final data analysis of their vaccine indicated 95% effectiveness in preventing Covid-19 and even appeared to fend off severe disease.
However, the optimism faded out these days. As the confirmed cases in Europe and the US continue to surge, investors are now becoming alerted about the potential lockdown measures announced by those authorities. Furthermore, the market is questioning about the limitations of vaccine, making the economic recovery a bit doubtful.
Political uncertainty of course is one of the issues. President Trump once again criticized the injustice of the election and his team has already paid $3 million for the vote recounting. Also, at the moment there is no progress for the fiscal stimulus in the US Congress. It is unlikely that the Republican and Democratic leaders will reach any agreement in a very short term. McConnell repeated so many time that he is just willing to pass a $500 billion bill.
As the risk-off sentiment returns, dollar is a bit stronger when traders are seeking safe haven, with the dollar index trading at 92.5 level.
ZFX analyst Jacob Leung said that, even the vaccine sounds very positive to the market, however, investors may realize that the economies cannot be recovered as fast as expected. The market may has already “priced-in” such situation if we look at the current level of stock indexes around the world. And, that may be why investor nerves are always being tested.