The beginning of the week indicates an improvement in sentiment on the stock market. On Monday, April 6, we may observe increases in major stock indices. In Australia, ASX increased by about 4 percent. In Japan, Nikkei increased by about 4.5 percent, and futures contracts on the American indices are also listed by more than 4 percent above Friday closing.
Improving sentiment in the markets may be associated with a decrease in the number of coronavirus victims, which gives hope that the first shock wave of the pandemic is slowly coming to an end. At the end of the weekend, New York saw the first one-day decrease in deaths caused by a coronavirus. New York is the state with the largest number of confirmed cases of infection.
The situation began to improve also in Europe. Italy has had the lowest number of deaths in over two weeks. France reported the lowest number in five days, and in Spain, the number of COVID-19 victims fell for three consecutive days. If the current trend visible in New York and Western Europe is maintained, then the chances of maintaining a good sentiment among investors may increase, but above all social moods may improve. There are many indications that summer may bring a fall in illnesses and casualties, which may lead to a partial loosening of the current restrictions, but it is still very uncertain what the situation will look like in autumn.
At one point in the oil market, we saw a decline of over 6 percent today. However, the price, along with the global improvement of sentiment, seems to be returning towards the Friday high. According to the Bloomberg agency, according to diplomats, some progress was made on Sunday towards an agreement of crude oil producers. However, the lack of participation in the talks of the United States – the largest producer in the world – may prove to be an obstacle to its achievement. The virtual OPEC + meeting planned for Monday has therefore been postponed, because without the United States, which additionally threatens to impose tariffs on oil, cutting global production will not be possible. Saudi Arabia and Russia may not agree to cut themselves without US participation.
Daniel Kostecki, Chief Analyst Conotoxia Ltd.
Materials, analysis and opinions contained, referenced or provided herein are intended solely for informational and educational purposes. Personal opinion of the author does not represent and should not be constructed as a statement or an investment advice made by Conotoxia Ltd. All indiscriminate reliance on illustrative or informational materials may lead to losses. Past performance is not a reliable indicator of future results.
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