10 top events at financial market during Q1 2020
1. The end of bullish trend at stock indices
Top global indices, indicating the performance of respective economies, experienced significant drops during Q1 2020, but at the end of March, thanks to massive stimulus, remarkable increase was seen. Final results per first quarter are following:
S&P 500: -20%
DAX 40: -25%
2. Price war of Saudi Arabia and Russia
Price per oil barrel has dropped to the lowest level from 2002 in the first quarter, even below the price of $20 per barrel. The reason is the significant drop of demand caused by spreading covid-19 and the “price war” between Saudi Arabia and Russia.
3. Gold heading to reach its historical max
Gold proved to be safe haven when investors started to get rid of risky assets, including stocks and oil. Its price rose to almost $1,700 per troy ounce. However, from a long-term perspective, it lacks sufficient importance for investors due to its zero yield and expectations of anti-inflationary pressure.
4. Czech Koruna back at levels before interventions
At the beginning of this year, EUR/CZK exceeded the level of CZK25.00, supported by optimistic economic data and rate hike of the Czech National Bank. The spreading of covid-19 into the Czech Republic, isolation of the Czech economy and the fact that Koruna belongs to risky currencies of developing economies cause significant outflows of foreign capital and weakening up to even CZK 28.00 against EUR. In case of further weakening, the Czech National Bank is prepared to intervene in a form using its foreign exchange reserves in the market.