Global Markets Rebound on Hopes of a Massive Fiscal Stimulus to Mitigate the Economic Damage from Coronavirus

  • Mar 24, 2020 GMT
  • Team Kalkine
Global Markets Rebound on Hopes of a Massive Fiscal Stimulus to Mitigate the Economic Damage from Coronavirus

US Markets: Broader indices in the United States traded in green - particularly, the S&P 500 index traded 161.23 points or 7.21% higher at 2,398.63, Dow Jones Industrial Average Index expanded by 1,608.45 points or 8.65% higher at 20,200.38, and the technology benchmark index Nasdaq Composite traded higher at 7,276.98, up by 416.31 points or 6.07% against its previous day close (at the time of writing, before the U.S market close at 1:45 PM ET).

US News: The announcement of unparalleled stimulus injected by the U.S Federal Reserve and other policymakers along with hopes of USD 2 trillion rescue package, resulted into the recovery of Global equities by nearly 2% on Tuesday. However, the unlimited bond-buying offer would require time to tame the economic disruption by infusing additional dollar into world markets and allowing businesses to pay off their stakeholders. Notwithstanding, the U.S. business activity (comprising both manufacturing and services sectors) contracted to record low amidst coronavirus pandemic state. Bolstering the depression argument by economists, U.S. Composite Output Index stood at record low 40.5 in March (Below 50 refers to contraction). While, Gold prices are inching towards seven-year high post being beaten down past week. Also, the stocks from Hotels and Airlines space are rising with anticipated rescue package of government. Among the gainers were -  MGM Resorts (30% up), Wynn (22% up), JetBlue (25% up) and American Airlines (23% up), at the time of writing. Meanwhile, a leap in oil prices towards USD 28 per barrel, strengthened the energy stocks. Oil majors like Exxon Mobil Corp. and Chevron Corp. surged by around 7%. Also, Ford Motors announced a collaboration with GE Healthcare and 3M Company to accelerate production of ventilators and respirators to curb Covid-19 contagion. Consequently, the stock price of Ford, General Electric and 3M Company surged over 6%, 12% and 7%, respectively. Contrarily, the Boeing supplier Spirit Aerosystems had to suspend production of US facilities, due to depleting demand, led by travel bans globally. They are instead focusing on pre-delivery down payments and grounding issues of 737 MAX jet, and hence, their stock price rose by 18%.

S&P 500 (SPX)

Top Performers*: Norwegian Cruise Line Holdings, Halliburton Co and Darden Restaurants Inc shares increased by 27.30%, 26.53% and 26.25% respectively.

Worst Performers*: Kroger Co, Verizon Communications Inc and Regeneron Pharmaceuticals Inc shares decreased by 3.47%, 1.79% and 1.43% respectively.

NASDAQ Composite (IXIC)

Top Performers*: IMAC Holdings Inc, Mid-Con Energy Partners LP, and Century Casinos Inc shares expanded by 244.60%, 162% and 73.75% respectively.

Worst Performers*: Milestone Pharmaceuticals Inc, Baudax Bio Inc and New York Mortgage Trust Inc shares plunged by 84.29%, 45.77% and 44.71% respectively.

Top Performing Sectors*: Energy (Up 9.82%), Industrials (Up 7.08%) and Basic Materials (Up 6.97%).

Dow Jones Industrial Average (DJI)

Top Performers*: Chevron Corp, Boeing Co and Mcdonald’s Corp, are the top gainer and Increased by 16.40%, 14.09% and 12.47%.

Worst Performers*: Verizon Communications Inc, Walmart Inc and Procter & Gamble Co are top laggards and decreased by 2%, 0.81% and 0.31% respectively.

European Markets: The London’s broader equity benchmark index FTSE 100 traded at 452.12 points or 9.05% higher at 5,446.01, the FTSE 250 index snapped at 1,094.72 points or 8.37% higher at 14,172.73, and the FTSE All-Share Index ended 241.72 points or 8.86% higher at 2,969.58, respectively. Another European equity benchmark index STOXX 600 ended, up by 23.57 points or 8.40 per cent, at 304.00.

European News: On 24th March 2020, European Markets followed global financial markets on a rebound spree, as major stocks and stock indices opened in the green. Major cities around the European Union were sent into lockdowns by their respective governments. The FTSE 100 index was up by around 9 per cent as investors felt confident after the U.S. Federal Reserve's offer of unlimited expansion of asset purchases to ensure the stability of financial markets. In terms of stocks, UK's commodity-heavy FTSE 100 was backed by a rise of oil and metal prices. Oil giants such as the likes of BP Plc and the Royal Dutch Shell Plc increased by more than 15 per cent, while the wider mining index was up by approximately 10 per cent, primarily because of the BHP Group, Rio Tinto and Anglo American Plc stocks showed major gains in the market. Travel and Tourism companies as well as airlines stocks such as Carnival Corporation and Intercontinental Hotels Group were both up by 8 per cent during the day’s trade.

London Stock Exchange

Top Performers*: CINEWORLD GROUP PLC (CINE), 888 HOLDINGS PLC (888) and SIG PLC ORD(SHI) are top movers and rose by 30.54%, 28.14% and 25.96% respectively.

Worst Performers*: RPS GROUP PLC (RPS), ASA INTERNATIONAL GROUP PLC (ASAI) and CLIPPER LOGISTICS PLC (CLG) plunged by 16.91%, 14.56% and 9.73% respectively.

FTSE 100 Index

5 days FTSE 100 Index Performance (March-24-2020), before the market closed (Source: TR)

Best Gainers*: CARNIVAL PLC(CCL), PRUDENTIAL PLC (PRU) and RSA INSURANCE GROUP(RSA) expanded by 20.10%, 15.82% and 14.35% respectively.

Non Performers*: ITV PLC (ITV), OCADO GROUP PLC (OCDO) and JOHNSON MATTHEY PLC (JMAT) plunged by 3.93%, 3.40% and 3.27% respectively.

Shares traded with high-level volume*: (LLOY) LLOYDS BANKING GROUP PLC; (BP) BP PLC; (VOD) VODAFONE GROUP PLC.

Top Sectors traded in the positive zone*: Energy (up 12.01%), Basic Materials (up 7.92%) and Technology (up 6.82%)

Forex Rates*: GBP/USD and EUR/GBP were hovering at 1.1736 and 0.9172, respectively.

Bond Yields*: U.S 10-Year Treasuries yield was tilting at 0.826%, and the UK 10-Year Government Bond yield was hovering at 0.447%, respectively.

 

*At the time of writing

   
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