Sales of Stocks and Oil Continue (Weekly Review)

2020-03-24
The worldwide spread of coronavirus has become a major driver in financial markets. The most dramatic events take place on world stock exchanges, as well as on the oil market, where for several weeks in a row bears rule the ball. Among the leaders of the fall in shares are air carriers, insurance companies, and oil futures, in addition to fears for world energy demand, were the victims of the oil war launched by Saudi Arabia in response to the refusal of the Russian Federation to resort to an even greater reduction in production.

To avoid a financial crisis, world central banks lower interest rates and launch or expand asset purchase programs, which provides some support to the stock market, but any rebounds from regular lows continue to attract fresh interest in sales. The threat from the United States to intervene in the oil market also had only a temporary positive effect.

In the foreign exchange market, the USD remains dominant, even pushing for such traditional “safe haven” assets as the CHF, JPY, and Gold. One cannot possibly predict how long its hegemony will last, but the constant injections of the US Federal Reserve liquidity may have a negative effect on the USD. At the same time, the difficult situation in Italy, Spain, and the UK is unlikely to allow the EUR and the GBP to develop steady and large-scale growth against the USD, while market volatility will remain increased.

Schedule for this week:

Monday, March 23
11:00 GMT - Eurozone. G20 Meeting;
16:00 GMT - USA. US Senate Votes on Coronavirus Rescue Package.

Tuesday, March 24
22:00 GMT - Australia. Commonwealth Bank Manufacturing Purchasing Managers Index (PMI) (Mar);
08:30 GMT - Germany. Markit Manufacturing Purchasing Managers Index (PMI);
08:30 GMT - Germany. Markit Composite Purchasing Managers Index (PMI);
09:00 GMT - Eurozone. Markit Composite Manufacturing Purchasing Managers Index (PMI) (Mar);
09:30 GMT – United Kingdom. Markit Services Purchasing Managers Index (PMI);
09:30 GMT – United Kingdom. Markit Manufacturing Purchasing Managers Index (PMI);
13:45 GMT - USA. Markit Composite Purchasing Managers Index (PMI);
13:45 GMT - USA. Markit Manufacturing Purchasing Managers Index (PMI);
14:00 GMT - USA. New Home Sales.

Wednesday, March 25 
01:00 GMT – New Zealand. Reserve Bank of New Zealand Interest Rate Decision;
01:00 GMT - New Zealand. Reserve Bank of New Zealand Rate Statement;
09:30 GMT – United Kingdom. Consumer Price Index (CPI);
12:30 GMT - USA. Durable Goods Orders;
13:00 GMT - Switzerland. SNB Quarterly Bulletin (Q1).

Thursday, March 26 
09:30 GMT - United Kingdom. Retail Sales;
12:00 GMT - United Kingdom. Bank of England Interest Rate Decision;
12:00 GMT - United Kingdom. Bank of England Meeting Minutes;
12:30 GMT - USA. GDP Annual (Q4).

Friday, March 27 
23:30 GMT - Japan. Consumer Price Index (CPI);
15:00 GMT - USA. Michigan Consumer Sentiment.

Author: Anthony Porter, IAFT Analyst

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