“Investors have turned their backs on risky assets in order to play it safe as global stocks continue to be hammered by the ever-growing coronavirus epidemic……
By Mihir Kapadia, the CEO of Sun Global Investments
As a result, global markets are likely to hit their worst weekly slump since the 2008 financial crisis – emphasising the scale of the influence the virus has had this past month. The S&P 500 is down 4.42% while the Dow and Nasdaq have fallen more. The decline has accelerated in the last few days despite President Trump’s claims that the coronavirus risk in the US remained “very low”.
In Asia, the Japanese Nikkei plunged 4.3% today while shares in mainland China also declined. Europe is also struggling on Friday with all major stocks opening down with the FTSE down 3.01% as Bank of England’s Mark Carney warns that a global shutdown would harm UK growth.
One factor influencing investors is that in a hyper-connected world it appears no country is safe from the coronavirus, with major economies all being impacted and looking likely to spread even further. As a result, this is only generating more uncertainty and the lack of conviction from governments and policymakers is only making the situation more concerning. This is causing them to turn to safe havens, with gold in particular enjoying an increased inflow of investors to touch new-record prices.”
Source : ETFWorld.co.uk