Update 08-04-2020: Dow Jones gains fail to spur rebound from European indices

Bucking the trend seen throughout the morning session, the Dow Jones opened in the green on Wednesday afternoon.

 

The Dow really lost steam on Tuesday, from an 800 point surge after the bell to a red-tinged close. It will be hoping for a tad less drama today given it opened a comparatively measured 230 points higher.

 

That pushes the Dow back towards 22900, around 500 points shy of yesterday’s intraday, 4-week peak.

 

This wasn’t, however, enough to cause the European indices to reserve their losses. Instead the region’s indices, perturbed by the EU’s lack of cohesion regarding the coronavirus, remained in the red, undoing a chunk of the progress made in the first half of the week.

 

The DAX and CAC were both down 1%, slipping to 10250 and 4390 respectively. The FTSE, meanwhile, shed 70 points, sending the UK index back to 5625. Losses in its oil, mining and banking sectors didn’t help, nor did Tesco’s post-FY downturn.

 

Sterling also had a hand in keeping the FTSE in the red. The pound was up 0.4% against the dollar and 0.7% against the euro, perhaps related to news that Boris Johnson is ‘responding to treatment’ in intensive care. The currency may be given a bit more of a workout on Thursday, which sees the monthly GDP readings for the UK, alongside the manufacturing and industrial production numbers.

Update 07-04-2020: Dow Jones opens above 23000, but loses energy after opening bell

Though the Dow Jones initially exploded out of the gate, it did cool slightly as the opening bell receded, taking the edge off of Europe’s gains in the process.

 

A 400 point rise is nothing to be sniffed at. However, it is noticeable lower than the 800 point surge the Dow posted at the very start of the session, keeping it above 23300, but shy of its 23400, 4-week highs.

 

As mentioned, this in turn sapped some energy from Europe. The DAX, which roared back into a bull market as it struck 10600, found itself trading the wrong side of 10300 as its gains were trimmed to 200 points, while the CAC fell back under 4400, more than 100 points shy of where it was at lunchtime.

 

The FTSE was no different. Losing almost 100 points from its intraday peak, the UK index slipped back towards 5650.

 

How Europe ends up opening on Wednesday is likely going to be determined – in part at least – but where the Dow Jones et al. close this evening. If the US markets can build up some momentum, the week’s rebound could continue. If the energy dissipates even further, however, investors might start to lose a bit of their bravado.

Update 06-04-2020: Dow Jones jumps 1000 points, Europe remains strong as investors hope for stabilisation

The US indices indulged in the same hopes as their European peers on Monday, perhaps prematurely celebrating signs of coronavirus stabilisation from around the world.

 

The Dow Jones started big, adding 1000 points as it re-crossed 22000. It will be interesting if it can substantially push past that level in the next few sessions. For the last week or so it has been trading between 21000 and 22000, unable to find justification for a foray above the latter, yet not so shocked by America’s growing unemployment crisis to fall through the former.

 

With the Dow in high spirits, the Eurozone indices beefed up their own growth. As Germany draws up plans to end its lockdown after April 19th, the DAX surged more than 500 points, propelling the bourse back above 10000. Following the US open, meanwhile, the CAC levelled up its own gains enough to hit 4340 as it rose 4.5%.

 

Trailing its US and Eurozone buddies, the FTSE climbed 140 points, somewhere between its opening highs and lunchtime intraday lows. Brent Crude’s 3.4% fall, and the subsequent losses for BP and Shell, clipped the index’s wings. As did the fact that the UK is still far behind its European cousins in terms of the crisis timeline (admittedly that reasoning doesn’t explain why the Dow is so high given that the US is far and away the leader in coronavirus cases.

Source: SpreadEx