Global Fundamental Analysis 20/04/2020

OPENING CALL: The Australian share market is expected to open lower. 


Volkswagen will restart car plants across Europe next week, offering a pandemic-era blueprint for other global manufacturers that will alter workers’ daily lives and, at
least temporarily, relegate productivity to the back seat.


Procter & Gamble Posts Biggest U.S. Sales Gain in Decades  Increased demand in P&G’s home market amid the coronavirus pandemic more than offset
steep declines in China, where virus fallout kept consumers from buying.


Overnight Summary




Australian Market

Aussie shares are trading near the lows of the day, with the ASX 200 down 1.37 per cent to 5,412.3 due to losses across all sectors at lunch. This is enough to wipe out Friday’s gains and most of last week’s 1.86 per cent advance. Keep in mind that the Australian sharemarket has improved for four consecutive weeks and is
trading near a one-month high.


US Market

U.S. stocks rallied, putting major indexes on track for a second consecutive week of gains, buoyed by optimism that parts of the American economy may begin reopening in
coming days. The Dow Jones Industrial Average climbed 705 points, about 3%, led higher by shares of Boeing. The S&P 500 added 2.7%, and the Nasdaq Composite added 1.4%.   The gains this week are especially notable because they build on a blockbuster week for stocks. Last week, the S&P 500 logged its biggest one-week percentage gain since 1974, while the tech-heavy Nasdaq recorded its biggest one-week percentage gain since 2009.

All three indexes are still down more than 12% from their mid-February highs, but they have roughly cut their losses in half since late March. The five-day period represented the first back-to-back weeks of gains for the Dow since February.



Gold futures ended with a loss, contributing to a roughly 3% fall for the week.  Investors shunned haven assets amid early optimism over a drug that’s anecdotally shown
potential to treat COVID-19 and the release of a road map to gradually reopening the U.S. economy.

Gold for June delivery on Comex fell $32.90, or 1.9%, to settle at $1,698.80 an ounce, with prices down 3.1% from the $1,732.80 finish on April 9, according to FactSet data. Trading last Friday was shut for the Good Friday holiday.


Oil Futures

Oil prices ended the session 8.1% lower at a fresh 18-year-low of $18.27/bbl. as the coronavirus weakened global demand by nearly one-third, leaving investors wondering if oil consumption rates will ever return to pre-Covid levels.
Analysts, however, note that while the front-month WTI crude contract for May delivery fell sharply, most of the later-dated contracts traded comfortably higher throughout the session, suggesting benchmark prices could rebound sharply once a U.S. economic reopening promoted by President Trump begins to take hold and perhaps spreads around the world.

For the week, WTI ended nearly 20% lower, marking the seventh weekly decline over the past eight weeks.



The U.S. dollar weakened against other major currencies, including 0.3% against the yen and euro.  The S&P 500 gained 2.7% as investors showed more appetite for riskier investments.

The major U.S. stock indexes posted their second straight week of gains, the first back-to-back increases in two months.  The WSJ Dollar Index fell 0.4%.


European Markets


Asian Markets

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