Markets opened lower in Europe on Monday, following the trend set by most Asian benchmarks while US futures are pointing to a steady open after last Friday’s end-of-session decline. Market sentiment remains weak today, despite a Chinese CPI release topping estimates earlier this morning, as investors prefer to stay cautious after the latest development on the coronavirus. The death toll has now hit 910 while the number of people infected topped 40,000 during the weekend with more and more cases registered outside mainland China and still no sign of a peak. This situation starts to have a serious impact on investors’ trading stance as the negative consequences to worldwide economies may linger further into Q2 if the virus continues to spread.
Chances of an extended rally on safe havens like gold, silver, CHF, JPY and other alternative assets such as cryptocurrencies are likely as traders may prefer to diversify their exposure to fight against the current uncertainty while central banks from emerging markets have already taken measures to insure certain liquidity levels this week in order to reassure investors. Travel and media shares are currently driving the Stoxx-600 Index lower in Europe with the DAX-30 index the worst performer so far. In the meantime, investors will focus on a new batch of corporate earnings with Cisco Systems today and Alibaba, Credit Suisse and Nestle later this week.
