As a New York Times headline so succinctly put it: “A global disease outbreak isn’t the kind of risk that many investors were trained to react to.” Add to that an oil price war involving two major producers- Saudi Arabia and Russia, and you get the sort of extreme market volatility we’ve seen since the beginning of the year when reports about the Coronavirus first surfaced, and especially in the last week.
There is currently a lot of uncertainty, eclipsing almost everything else and destroying investor confidence. There’s uncertainty about how bad the coronavirus out break currently is, how bad it can get, whether authorities can get it under control, how much will it disrupt our lives, how much will it disrupt businesses? How long will Saudi Arabia be willing to keep oil prices low to hurt Russia, how will these low prices affect US shale producers as well? What will the reactions of Russia and the US be?
These are all questions weighing heavily on investor sentiment.
Why is the coronavirus having such a massive impact on the global economy? Continue reading “How Coronavirus Is Affecting Investments”
