Gold is a clear winner from the pandemic
Gold was initially sold off in February and during the early part of March. But since then gold has made substantial progress from the March lows, mostly due to central bank stimulus activity.
Gold was around $1775.00 as of Wednesday 24th June.
Stocks fall flat
After a strong bounce on Tuesday 23rd, European markets opened lower Wednesday 24th June, with the FTSE 100 slipping back under 6,300. The DAX was also weaker and broke down through support at 12,400.
The Dow is holding at around 26,100 while the S&P 500 is finding support at around 3,115 level. The Nasdaq, however, continues to break new highs – closing Tuesday 23rd June at: 10131.
U.S. futures suggest a drop of around 200 points at the open on 24th June.
Equity markets continue to trade the ranges as investors search for direction. Doubts linger on just how quickly economies will recover and whether second wave threats will materialise to hold up a quick economic recovery.
U.S. cases increase
The U.S. states of Texas, Arizona, California and Florida continue to struggle as they suffer large coronavirus case increases. Germany has been forced to make local lockdowns as the ‘R’ number ticks up again.
UK easing lockdown restrictions
The UK announced its next stage in its easing lockdown plan – this included the re-opening of pubs, restaurants, holiday accommodation, cinemas and hairdressers with strict social distancing and hygiene rules in place.
Fears of a second infectious wave are very real in the UK too, as masses of people will soon start to ‘mingle’ again. But what can you do, we can’t hibernate forever. Risk of a second wave is balanced against economic catastrophe.
It’s inevitably that there will be more cases, but economies have to re-open sooner or later. We will have to learn to live with this bloody disease, at least in the short-term as indeed we have learned to live with cancers, influenza and many other diseases.
I have faith that it will get fixed – a vaccine isn’t that far away.