Global stock prices rebound and rise; will the trend continue today as well? "Key points and event schedule for March 11"
Yesterday, stock prices rose on expectations for President Trump's fiscal policy, and the dollar-yen also surged!
It rose temporarily to exceed 105.50 yen.
However, since the rise was due to expectations, when negative remarks or reports emerged, it fell sharply, with volatility continuing as it fell 50 pips in minutes and then rose 50 pips in minutes.
U.S. interest rates also saw the 10-year Treasury yield fall to around 0.3% at one point, but it has recovered to around 0.8%.
The stock market also saw a record recovery with the Dow Jones Industrial Average rising by more than 1,100 dollars.
Recently, U.S. stocks have been repeatedly surging and plunging by over 1,000 dollars, so there is a possibility of another decline tomorrow.
We would like to confirm whether a full-fledged recovery trend has begun or if a bottom has been reached.
◎ Today's Points of Attention
1) The impact of COVID-19 (novel coronavirus)
As infections and affected areas expand, attention is shifting from China to Europe and the United States.
Italy is focusing on mobility restrictions to prevent the spread of infections.
Italy, which has many infections in Europe, is expected to take bold action by the ECB at the Board of Directors on the 12th.
In the United States, President Trump is considering fiscal policies such as exemptions for payroll taxes, and the Fed is being urged to implement substantial monetary easing such as large rate cuts and QE.
In the United States, stock prices have rebounded due to expectations for Trump policies.
The impact of COVID-19 is turning into a seesaw game between risk-off due to the virus and economic support policies from various countries.
Today too, attention is on whether risk-off factors due to COVID-19 will react strongly or whether stock prices will react strongly to expectations of fiscal spending.
2) Presidential Primary
From yesterday to this morning, presidential primaries were held in Michigan, Washington, Idaho, Mississippi, Missouri, and North Dakota in the United States.
As voting progresses, it is expected that the results will be largely known by early afternoon Japan time on the 11th.
With left-wing Sanders and centrists Biden in a tight race, all eyes are on whether one will pull ahead significantly in today's primary.
Sanders is viewed with concern by Wall Street, so if Sanders leads, there may be downward pressure on stock prices; caution is advised.
3) Crude Oil Prices
Oil prices have been affected by statements from Russian Energy Minister Novak that Russia would coordinate with OPEC to calm the oil market, and by the Kremlin spokesperson also mentioning potential resumed talks on coordinated production cuts, which has helped stabilize declines.
The focus is on the production increase battle among the United States, Saudi Arabia, and Russia.
In the U.S., although shale oil production costs are higher than those in the Middle East, hedging through futures trading may allow for sustained low prices for a while.
There are claims that Russia has a fixed-price deal with China and has profits accumulated from last year's oil price rise, so it is said they could withstand price competition.
Saudi Arabia produces a lot of oil and has low production costs, so it should be most advantaged in price competition.
All eyes are on whether these three countries will continue a price-unworthy price-increase battle causing prices to fall, or whether someone will blink and restart coordinated production cuts.
◎ Today's Event Schedule
Wednesday, March 11
Presidential primary vote counting in Michigan, Washington, Idaho, Mississippi, Missouri, and North Dakota
08:30 AUD Westpac Consumer Confidence Index
18:30 GBPUK GDP
21:30 USDU.S. CPI (Consumer Price Index)
23:30 USD Crude Oil Inventories
Thursday, March 12
02:00 USD U.S. 10-Year Bond Auction
03:00 USD Monthly Budget Statement
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