Gerald Fitzgerald’s Market Review March 9th

LAST WEEK IN 30 SECONDS...

March began as February ended with investor uncertainty generating increased volatility in equity and bond markets. Not even a surprise intervention by the US Federal Reserve, cutting interest rates by 0.50% could quell increasingly anxious markets. Government bond yields hit the floor with German 10-year bund yield smashing through previous historic lows set in 2019 to finish the week at -0.73%.

Global equities finished the week down 2.4% in euro terms as currency movements compounded market weakness. This does not paint the full picture, however, given the rollercoaster risk-on risk-off sentiment experienced over the week.

THIS WEEK IN 30 SECONDS...

Equities have started the week on a fragile footing, as a dramatic cut in oil prices by Saudi Arabia has contributed fresh negative sentiment to an already distressed market.

General economic disclosures are having limited influence in markets given the major influence of the COVID-19 virus. The ECB announces its latest policy decision on Thursday. With the invasion of COVID-19 within developed markets, there are persistent calls for further support which is looking increasingly likely. With a limited arsenal available given a heavily utilised armoury in the last decade, however, the ECB will hope for indications of breakthroughs in detection and management of this virus.

CRUISE SHIPS IN CHOPPY WATERS

Icebergs are the least of the worries for cruise liners. The outbreak of COVID-19 has had a major impact on markets but none more so than on cruise ships. Since the start of the year, the negative publicity following outbreaks of the virus on board some cruise liners has sent investors overboard with Carnival, Royal Caribbean and Norwegian down over 46% for the year-to-date.