Wall street returns from 1987. US indices have violently rebounded a 9% (Dow Jones: + 9.36%; S&P 500: + 9.29%; Nasdaq: + 9.34%), in its most bullish session since 2008, after experiencing its biggest crash since 'black monday' of the 80s. The Dow Jones has already collapsed a twenty-one% from its all-time high, which is why it has entered what is called the 'bear market', after liquidating the bull market that started just 11 years ago, in March 2009.
Donald trump just declared the national state of emergency in U.S to increase the response capacity against the coronavirus pandemic.
This declaration of national emergency will release $ 50 billion to curb the impact of the covid-19. Trump has said he hopes the United States has 1.4 million kits Coronavirus testing available within a week, and a total of 5 million kits within the next month.
The state of NY It has become the one that has confirmed the most infections, since the cases have increased a 30%, until 421, as confirmed by the Governor of New York, Andrew Cuomo, this Friday. "This will not be a quick situation. This is going to last for weeks, months. I think there are thousands upon thousands of cases walking through New York State, "said Cuomo.
The VIX volatility index It has dropped 24% to 57 points, after marking a maximum of almost 73 points this Thursday. The fear index marked levels not seen in the market since the great financial crisis of 2008.
"We have no guarantees and things can get even uglier," warn analysts at Commonwealth Financial Network. "If the number of cases continues to rise, the economic damage will go from weighing down confidence to something worse," they say. "Investors should undoubtedly review their portfolio and find out if they remain calm at current risk levels," experts at E-Trade.
THE GOLDMAN SACHS ASSESSMENT
According Peter Oppenheimer, head of global equity strategy at Goldman Sachs, the current bear market is being triggered by the coronavirus, "suggesting that the rebound in the equity markets will be rapid"
The scenario he manages is a additional 10% drop for three months for the S&P 500, up to 2,450 points; and a subsequent recovery until 3,200 points by the end of the year, which would imply a 30% rise from its expected minimum. The main world indicator sank to 2,480 points, almost reaching Goldman's drop target; and this Friday it rebounds to 2,600 points.
In other markets, oil West texas it rebounds 1% to $ 31.81, although it has closed its most bearish week since 2008. For its part, the ounce of gold falls 5% to $ 1,511; and the euro it depreciates 0.67% and changes to $ 1.1107. Finally, the 10-year American bond yield It rebounded to 0.99% after marking a record low of 0.32% last Monday.
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