New virus fears create uncertainty in U.S. Stock Markets
Major stock indices reacted on Monday to renewed fears of the coronavirus. New COVID-19 cases surged last week in a number of U.S. states including Texas and Florida, and there were reports of other flare-ups around the world. The virus may be resurfacing in China where it was reported that close to 80 new coronavirus infections were recorded in Beijing over the weekend.
Although this pales in comparison to the recent 1,000 plus daily numbers in Texas, the new outbreak from the Chinese capital is the first more than 50 days.
The benchmark S&P 500 index fell as much as 2.5% in early trading on Monday, however found its way back above 3000 after briefly breaking out of this support.
UK and EU look to speed up Brexit talks
In the midst of the current health crisis, Brexit talks have been somewhat muted.
However, the EU and UK have decided to intensify talks in the upcoming weeks as concerns grow that a trade deal may not be reached by the end of the year.
After initial discussions that so far have not yielded any significant progress, Prime Minister Boris Johnson spoke with EU trade officials today, outlining ways to give new impetus to the trade negotiations.
The news came as a positive for European markets, in particular the DAX which rose to over 12,000.
FTSE 100 gains as UK stores re-open
After announcing that the UK economy had contracted by over 25% in March and April, today saw most of the impacted businesses return to work.
Non-essential retailers were allowed to re-open to extended queues of customers looking to spend during the summer sales.
One of the big winners of this reopening is Primark, which has opened all 153 of its UK stores.
The FTSE 100 broke back into the 6,100 level, after dropping to as low as 5,925.
“The fundamental law of investing is the uncertainty of the future.”Peter Bernstein
S&P 500: After suffering its biggest one day drop since March late last week, The S&P 500 initially continued to fall on Monday, retracing back to the 2,955 floor. However, the markets bounced at that level and are now at 3,041 in afternoon trading.
Gold: Gold dropped by $30 in early trading on Monday, but after reaching its $1,703 floor the precious metal attempted to regain the day’s losses. By mid-day roughly 50% of Monday’s losses were recovered.