NEW YORK - When worries over the coronavirus shook U.S. stocks out of a period of quiet trading last week, investors wondered if the outbreak was the “Black Swan” event that would trigger a sharp decline. Less than a week later, talk has turned instead to a market melt-up.
The sharp snapback has revived concerns among some investors that market participants are growing overly confident that easy money policies from central banks will underpin prices, despite serious risks to global growth from the coronavirus. “There could be more downside if the spreads, but for now the trend is still up. The bigger risk is arguably that we end up in a mini-bubble,” said Troy Gayeski - Co-CIO of SkyBridge, an alternative investments firm.
The S&P 500 stands near a record high after rallying nearly 4% from its lows of last week. The Dow Jones Industrial Average and Nasdaq Composite have also hit highs while the CBOE Volatility Index, a gauge of investor anxiety, has drifted lower after spiking last week to its highest in nearly four months.
The World Health Organization said Wednesday was the first day the overall number of new coronavirus cases in China dropped, although the outbreak continues to rage in Hubei province. “Most people expect things will normalize by next week,” he said. “If there was an announcement of another extension...that will freak people out.”
All I hear are rescission fears - stock market goes up. Inverted yield curve - stock market goes up. Constantly discussing bubbles - stock market goes up. Corona Virus...all hell breaks loose. Should we be checking CDC for market predictions?
michaelcapolin2
The largest manufacturer in the world has put 400 million people in lockdown and the markets could care less. Print! coronavirus
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