We are facing another week of fighting the coronavirus epidemic. According to data from April 10, more than 1.6 million cases were confirmed worldwide. Unofficially, this value may be several times higher, because it all depends on the number of tests carried out. Governments, however, are already preparing to loosen the restrictions at the end of spring, which may be supported by rising temperatures and the seasonal effect of reducing virus transmission.
Hence, the key event of the coming week will be listening to the decisions of politicians who, in turn, want the economy to return to a relatively normal state as soon as possible. Nevertheless, the restrictions could probably be removed very gradually, or they would be only less stringent, which in consequence may prolong the return to normality in time. In addition to politicians, all eyes will be turned into the upcoming quarterly earnings season in the US.
American stock indices, on the wave of the state aid and the US Federal Reserve aid, have risen. Now, in turn, Wall Street will get a range of data from companies that could show how much they were affected by the epidemic and what their expectations for the future are. Publications will begin on April 14 with reports from Wells Fargo and JP Morgan and J&J. This will be information that could significantly affect the volatility of US stock indices, hence again attention can be paid to the S&P 500, DJIA or Nasdaq 100.
It will also be worth paying attention to oil prices, which collapsed after OPEC and Russia agreed to cut production to 10 million barrels for only two months. In addition, they expect G20 countries to cut production by another 5 million barrels a day. However, we will only find out about this on April 10 evening, when the G20 meeting is over. Hence, opening on the oil market after Easter may be interesting.
Another market comment will be released on Tuesday, April 14. Happy Easter.
Daniel Kostecki, Chief Analyst Conotoxia Ltd.
Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.
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