On Tuesday, global stock exchanges continued their fall - 26.2.2020

Today, futures for US stock indexes are “in the red”

On Tuesday, US stock quotes dropped down for the 3rd day in a row. The reason for this kind of negative tendency is still the epidemic of coronavirus. Investors suppose it can adversely affect the entire global economy. In particular, Apple, Nike, United Airlines and Mastercard have already announced a possible reduction in their income. It is worth noting that the growth rate of the number of cases with coronavirus in China is slowing down currently. The U.S. Centers for Disease Control and Prevention and the World Health Organization announced that the epidemic is likely to continue spreading in the United States and around the world. That statement was the main cause of yesterday’s descent in markets. In addition, the Associated Press declared the possible cancellation of the 2020 Summer Olympics in Tokyo. Until then, the opening of the games is scheduled for July 24. Over the past 2 days, the US S&P 500 (-3,03%) , Dow Jones Industrial Average (-3,15%) and Nasdaq (-2,7%) indices fell on Tuesday. Trading volume in US exchanges continued to increase and reached up to 12.24 billion shares, which is 53% more than the 20-day average. Today, the US is releasing data on new home sales in January. The US dollar Index ICE ICE is rising slightly today after a 3-day decline. Fed vice chairman Richard Clarida said his agency is monitoring the economy, but it's too early to talk about a rate cut (1.75%).

European stock indices have been falling for 5 days consecutively

European exchanges keep losing in price amid the growing number of infection cases in Spain. We are witnessing a full-fledged epidemic in Italy and that makes investors fear this country will fall into recession again. European companies began to lower their sales and profit forecasts for 2020, following the American ones. Yesterday, the “Danone” food group did so. Today, a possible reduction in profits was announced by the British alcohol company “Diageo” (producer of Johnnie Walker Scotch whiskey, Smirnoff vodka and Guinness beer). Its shares decreased by 3%, and securities of the alcohol companies Rivals Remy Cointreau SA and Pernod Ricard by 4.2% and 2.2% respectively. Investors expect a drop in European companies’ total profit by 1.2% in the 4th quarter of last year. Today, the Eurozone is not expected to publish any significant macroeconomic data. ECB President Christine Lagarde will make a speech that can affect the foreign exchange market. The EUR/USD rate does not change today in anticipation of this event.

Nikkei continues to decline today

All the Asian indices fell today. Nikkei (-2.1%) collapsed to a 4-month low. The shares of the advertising holding Dentsu Group Inc crashed to a 7-year low after reports of a possible cancellation of the Olympic games in Tokyo. Hang Seng. Hang Seng went down at 0.73% today. During the bidding, it fell by 1.5%, but then gained back а part of the losses after reporting about measures to stimulate the economy by the Hong Kong authorities. To manage that, they planned a peak budget deficit. The Australian stock S&P/ASX 200 fell 2,3%.

Brent lost in value today

Brent futures quotes updated their minimum since December 2018. Goldman Sachs, a major investment bank, lowered its forecast for the global oil consumption growth during this year from 1.6 million barrels a day to 600 thousand due to the coronavirus epidemy. He also reduced the forecast for the average Brent price from $ 63 per barrel to $ 60. The International Energy Agency (IEA) also lowered its forecast for global oil demand growth. In their opinion, it will be the lowest for the last decade and will amount to 825 thousand barrels per day. The data on the growth of oil reserves in USA for the week was declared for the fifth time in a row and appeared to be another negative factor for the quotations. This was reported by the American Petroleum Institute (API). Official stock data will be out tonight.