Coronavirus (COVID-19) Drives the Markets

Currently, we think that all the market participants are fully aware that Coronavirus (Covid-19) has become the main driver of Financial and Stock Markets at this time, especially, after the disease began to outbreak outside China to many other countries around the world. Recently, many countries such as Italy, Iran, South Korea, Japan, and others have announced many infections and death cases, in time, the number of infections and death cases is increasing in China.

Although the World Health Organization (WHO) has stated that the Coronavirus (Covid-19) does not yet constitute a global epidemic, the organization has said it may become so, with the diminishing of chances to containing the virus day by day.

The matter has been reversed on the global financial and stock markets since the crisis’ start with the beginning of this year, but the Coronavirus (Covid-19) effect has become clear with the beginning of trading sessions this week, where the US, European and Asian stock markets witnessed sharp declines.

On the other side, the safe-havens of commodities and currencies increased, foremost gold, while oil prices fell sharply with expectations of more weaken demand globally, as a result of the strict measures taken by some countries where the virus is spreading in, to control it and combat its spread.

Some sectors around the world have been affected greatly by Coronavirus (Covid-19). For example, the technology sector in the United States was affected by the stop of many factories and supply chains in China, and as a result, Apple shares fell to trade below 300.00 point level.

The energy sectors have also been affected since the beginning of 2020 in parallel with the beginning of China and world countries to impose strict measures to contain Corona pandemic’s spread by extending the lunar year holiday until the end of February, also by preventing air flights to and from China, which led to a weak in Chinese demand over the global oil market, therefore this led to a decline in global oil prices.

The tourism sector was among the sectors that were also affected by Corona epidemic, where the global tourism movement witnessed a stagnation state with the air traffic suspension to and from the countries, which have an increase in Coronavirus cases infection.

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