Global Fundamental Analysis 19/03/2020

OPENING CALL: The Australian share market is expected to open lower. The SPI200 futures contract expected to open 80 points down.


After talks with union leaders, General Motors, Ford and Fiat Chrysler agreed to halt operations at factories to protect workers, the latest sign that the pandemic’s disruptions to the auto industry overseas are hitting the U.S.  


Administration Proposes Direct Payments to Americans Totaling $500 Billion 


Overnight Summary




Australian Market

 Australian shares closed 6.4% lower despite paring losses late on. The benchmark S&P/ASX 200 fell steadily to sit 7.7% lower with 20 minutes left, before closing at 4953.2 as media reported Prime Minister Scott Morrison will on Thursday announce a huge fiscal and monetary policy package.  

Energy led losses with an 11% plunge, while the tech, property trust and consumer discretionary sectors lost more than 9%. More than a quarter of ASX 200 stocks suffered double-digit declines, including Qantas, which slumped 12% even though Mr. Morrison pledged to support the aviation sector. Afterpay was the worst performer with a 33% dump.  


US Market

Stocks fell as investors are seeking to raise cash quickly to cope with the economic disruption sparked by the coronavirus pandemic. The S&P 500 dropped 8.5% in afternoon trading, extending declines after triggering a circuit breaker that halted trading in U.S. stocks for 15 minutes. The Dow Jones Industrial Average fell 2,018 points, or 9.5%, to 19224, and the Nasdaq Composite declined 7.2%.  

All three indexes are down about 30% from their mid-February highs.  



April gold lost $47.90, or 3.1%, to settle at $1,477.90 an ounce following a climb of 2.6% on Tuesday. The price of copper tumbled to its lowest level in more than three years, falling 7.9% to $4,738 a metric ton on the London Metal Exchange. It is the first time copper has cost less than $5,000 a ton since late 2016.  


Oil Futures

U.S. benchmark oil prices crashed 24% to end the session at $20.37/bbl, marking the lowest closing price since 2002 as global efforts to stop the spread of the coronavirus sharply reduce oil demand, while major producers continue to keep pumping oil at robust levels.  



The British pound fell to its lowest level against the dollar in 35 years, a reflection of the U.K. economy’s unique exposure to the disruptions ripping through the global economy because of the coronavirus pandemic.  

Sterling has fallen rapidly in recent days, dropping another 4.2% against the dollar to $1.15 Wednesday. It has lost more than one-tenth of its value this year, according to FactSet.  


European Markets

European stocks tumbled as traders fretted about an economic downturn despite government efforts to stem the effect of the coronvirus pandemic. The Stoxx Europe 600 dropped 3.9%, the FTSE 100 fell 4%, the CAC-40 was down 5.9% and the DAX drifted 5.6%.  


Asian Markets

Hong Kong shares fell on concerns that global fiscal stimulus may not be enough to counter the economic fallout from the coronavirus pandemic. The benchmark Hang Seng Index closed down 4.2% at 22291.82, with losses broad-based.

Japan’s Nikkei Stock Average ended 1.7% lower at 16726.55, a new low since November 2016, as coronavirus concerns continued to weigh. SoftBank Group shares fell 11% to a three-year low of Y3,246, the biggest drop since October 2012. Broader market index Topix rose 0.2% at 1270.84.  

India’s benchmark Sensex gave up early gains to end down 5.6% at 28869.51, after S&P Global Ratings lowered its economic-growth forecast for the country to 5.2% for 2020.

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Source - database | Page ID - 21945

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