Fears of a pandemic caused the markets to free-fall last week and wiped out more than $5 trillion from global share value.
However, today Asian markets rebounded as investors put their hope in global monetary policy coordination in response to the impact of the Coronavirus.
The scale of losses prompted financial markets to price in policy responses, and this includes responses from;
- US Federal Reserve
- Reserve bank of Japan
- Reserve bank of Australia
ASX extends 7-session losing streak
Shares of major banks such as ANZ, Commonwealth Bank, NAB and Westpac all underperformed when the markets opened today. AUD hit a low of 64.58 cents early this morning.
More than half of the stocks in the index closed in negative territory, but the energy sector climbed today after a small surge in the price of Oil.
In total, $240m was lost last week on the Australian market. Australian financial regulators, including the RBA, the APRA and ASIC held an emergency meeting to discuss the impact of the virus.
Around the region, New Zealand's index closed down by around 1.4%.
Gulf stock market slammed
The demand of Oil in China has dropped by 20% as the outbreak forced measures such as flight cancellation, quarantine of millions, slow down production among others.
This is the worse week for Oil since 2008 and the oil-rich Gulf states were already battling a downturn in the economy before the threat of the virus was even present.
Crude that slumped below $50 a barrel in London on Friday may sink to less than $30 if OPEC doesn’t act at its scheduled meeting on 5 and 6 March, Standard Chartered was cited by Bloomberg.
In Saudi Arabia, the stock index closed down by around 3.7%, which is its lowest since 18 months. The Saudis are trying to convince Russia to agree to a cut in Oil production.
Financial Events to watch for today
10.00 GMT - EUR Unemployment Rate (Jan)