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Daily Archives: 24th February 2020

24th February 2020

🦠 COVID-19 Impacts Being Felt

MARKET CLOSE:
iTraxx Main

47.9bp, +4.8bp

iTraxx X-Over

242.5bp, +23bp

🇩🇪 10 Yr Bund

-0.48%, -5bp

iBoxx Corp IG

B+104bp, +4bp

iBoxx Corp HY

B+352bp, +25bp

🇺🇸 10 Yr US T-Bond

1.37%, -10bp

🇬🇧 FTSE 100

5563.74, (-5.25%)
🇩🇪 DAX

9815.97, (+1.90%)
🇺🇸 S&P 500

2626.65, (+1.89%)

Jolted by pandemic risks…

Markets swatted aside Trump’s broad attack on the establishment and the global order. Be it domestic politics, the trade spat with China (and others – Nafta, Europe) or the scuffles with Iran and North Korea, markets were barely riled.

We can add in the Eurozone’s multi-year woes, Brexit and a whole host of geopolitical skirmishes which might have let more of the air out of the asset bubble.

They were all seen as short term issues which, if need be, could be resolved with central banks having some ammunition left to soothe over the cracks.

Not so in Monday’s session.

A huge dash for safety which saw us back to flat or lower year to date for equities after falls extended to well over 4% in some markets during the session. Safe haven rates (10-year maturity) were bid only, and pushed yield levels not seen since Q3 2019 in Germany (-0.48%) or June 2016 in the US (1.37%). Gold was through the roof.

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