Gold 1635,87
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EURUSD 1,1295
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DJIA 22562
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OIL.WTI 31,605
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DAX 10308,57
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On Wednesday, WHO announced that the Coronavirus epidemic was a pandemic. What it means for the world and markets in particular. All forces will now be focused on fighting the infection. Countries are beginning to introduce quarantine. Borders, schools, universities, museums are being closed. For the economy, this is very sad news, because no one knows what it could lead to. Tourism is going down, trade turnover is going down, production is going down.
Chart of the day DAX
Markets are reacting to this situation ambiguously because they just don’t know where they’ll be better. The U.S. stimulus measures should correct the current situation and somehow determine the movement of exchanges for the near future. On Wednesday, after the statement of the WHO, markets started to decline again to the minimum values. S&P500 has been losing almost 5% since opening, DOW Jones is losing almost 6% and DAX closed 0.35% below opening.
Bitcoin
Cryptocurrencies do not feel very well after the collapse of the global financial markets. As it turned out, Bitcoin didn’t turn out to be a “safe haven”, but on the contrary, it was included in risk assets. Since the beginning of the week Bitcoin has lost about 12% and is not going to change its direction. By the end of Wednesday Bitcoin is trading around $7770 for 1 BTC.
Euro
In Europe, everyone is waiting for the ECB meeting, which will be held on Thursday. Probably, some measures to stimulate the economy will be announced there. So far, the euro against the dollar feels normal. The Euro trades lower, losing no more than half a percent, but as we know, the volatility is always reduced before serious news and statements of central bank heads. Also on Wednesday, the leaders of the European Union and the head of the European Commission established a special fund to fight against coronavirus. The funds will be used to develop a vaccine and support medical institutions.
Oil
Oil cannot get off its knees in any way and is traded on Wednesday at $36 per barrel of Brent brand. OPEC has not yet taken any specific actions to stabilize prices, while the Arab Emirates decided to further increase production. Such actions only raise panic in the market. A trade war is starting, so it is unlikely that there will be any recovery in oil in the near future. We will follow the plans to save the economies of the USA and the European Union. Maybe they will prompt us to take further actions.
What’s waiting for us today?
11.00 Volume of industrial production in Europe for January
13.45 ECB meeting
14.30 ECB press conference
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