Market Overview

9 March 2020

Another Dark Friday

Once again, Friday was marked by a great aversion to risk. The focus of the day was the uncertainty surrounding the coronavirus. The good data that came out regarding the American labor market had little impact in reducing this negative feeling in the markets.

As a result, what happened was that the main world stock markets suffered sharp declines. In particular, the Stoxx600 index closed on losing 3.86%, taking the minimum value of August 2019. On the other side of the Atlantic, the Dow Jones index decreased by 4.61% while the S&P 500 declined by 4.90% and the technological Nasdaq depreciated by 4.82%.

In the debt market, as is typical on a day of risk aversion, interest rates on European government bonds dropped significantly. On the other side of the Atlantic, the 30- year US treasury debt continues to pass the barrier below 1%.

With the significant higher sell-off of the Dollar when compared to the European currency, the Euro ended up appreciating by 1.24%.

Oil has been falling very abruptly, having depreciated by 8% on Friday. The reason for this decline is the lack of agreement between OPEC and Russia regarding the reduction in the level of supply.

Gold, on the other hand, had a mixed behavior, having fallen 0.14% despite the greater aversion to risk. Losses in the stock market, as well as the need to face margin calls, put pressure on sale of this metal.


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