Risk-Off: Crude Slides, Stocks Plunge

Risk-Off: Crude Slides, Stocks Plunge

Stocks Plunge on Coronavirus Fears

Coronavirus may have been headline news for most of us for the last month but it’s taken until this week to truly infect the markets, as investors flee risk amid a growing belief that we have a full blown pandemic on our hands.

Gold finding its feet after rocky couple of days

Gold is on the mend after sliding well off its peak just as investors needed the safe haven most. The rally in the yellow metal in February saw it come within touching distance of $1,700 at which point profit-taking kicked in. What followed may well have been a combination of stops being hit and even relate to the huge losses we were seeing elsewhere, but the safe-haven appeal is returning. Gold has recovered from its lows yesterday and, should investors continue to flee risk in the coming days – which I suspect they will – gold could do very well again.

Gold Daily Chart

Crude slides on global growth fears

Oil on the other hand may be in for a rough time. Already we’ve seen it give up its hard-fought gains from the last couple of weeks as coronavirus fears have spiked once again. Suddenly, we’re not talking about risks to Chinese growth, but global growth. If OPEC+ is slow to come out with measures to counter to anticipated demand hit, prices could fall quite quickly, with $50 Brent not too far away.

Brent Daily Chart

Economic Calendar

Original Post

Risk-Off: Crude Slides, Stocks Plunge

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