The major US indices are not particularly agile – on the contrary, the Dow Jones, S&P 500 and Nasdaq are all slumping again. Goldman Sachs is gloomy about the future.
After an up and down ride, the US stock markets ended trading deep in the red. Economic data, which was not quite as bad as feared, had temporarily helped prices to rise, but recession fears soon gained the upper hand, fueled by a pessimistic study by investment bank Goldman Sachs.
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Of the Dow Jones index fell 1.8 percent to 21,917 points. The index fell to 23 percent in the first quarter. It was the weakest first quarter since 1987 S&P 500 lost 1.6 percent of that Nasdaq composite closed 1 percent lower. 1,325 (Monday: 1,801) course winners were seen, with 1,665 (1,198) losers. 40 (37) titles closed unchanged.
The number of newly infected people and deaths in the United States is still growing rapidly, and there is no sign of a slowdown. And it is still uncertain to what extent the measures taken by the US government and the Fed will cushion the negative effects of the pandemic. How bad the US economy really is, but it would only show the data in the coming weeks, it said.
Gloomy outlook
Goldman Sachs already sees black for the US economy. The analysts at the investment bank have lowered their already pessimistic expectations. For the first quarter of this year, they expect economic output to decline by 9 percent, and in the second quarter they expect real GDP to drop by as much as 34 percent. So far, they had estimated the decline to be 6 percent in the first quarter and 24 percent in the second quarter.
However, Goldman is confident that measures such as bans on contacts or closings of shops and public institutions, for example, will significantly reduce the number of new cases in the coming month. A slower spread of the virus and compliance with restrictions by companies and individuals could pave the way for an economic recovery from May / June, the analysts said.
In the meantime, the crisis has not left quite as serious an impact on consumer confidence and the Chicago Purchasing Managers’ Index as expected. Both recorded a decline in March, but this was less than forecast by economists. The most recent data from China were also received positively. After the historical crash of purchasing managers’ indices, they returned to expansion in March for the service and manufacturing sectors.
WTI oil price is recovering thanks to good China data
after the Oil prices had fallen to the lowest level in 18 years the previous day, stabilization now occurred, supported on the one hand by better-than-expected economic data from China, and on the other hand slowed by the somewhat stronger dollar. Observers also only spoke of a technical recovery, because the stress factors continue to exist. Due to the negative impact of the coronavirus pandemic on the global economy, oil demand has collapsed, resulting in a strong oversupply. Then there is the price war between Saudi Arabia and Russia. The price of a barrel of the US variety WTI rose 1.9 percent to $ 20.48, Brent meanwhile, decreased 0.1 percent to $ 22.74.
Of the Gold price gave in more clearly. As with oil, the fixed dollar weighed on the price. According to AxiCorp, the Russian central bank has stated that it will stop buying gold from April 1. The troy ounce fell 3 percent to $ 1,575.
Of the dollar Meanwhile, many currencies benefited from its status as a “safe haven” in times of crisis, but also from increased dollar demand at the end of the quarter or fiscal year. In return, the euro temporarily fell below the $ 1.10 mark and was trading at $ 1.1020 in late US trade.
The lively demand for US bonds also spoke for the continuing uncertainty. Rising prices depressed the yield on ten-year bonds by 3.8 basis points to 0.68 percent.
Carnival’s waiver of dividends is well received
With regard to the individual values, the Ford share (minus 4 percent) was unable to escape the negative mood, although the automaker is creating a new mainstay in the wake of the Corona crisis. Ford plans to produce hospital ventilators that are needed for Covid 19 patients. The company wants to manufacture 50,000 devices within 100 days and then 30,000 pieces per month depending on demand.
In contrast, the Carnival cruise line’s decision to forego dividends and share buybacks was rewarded with an increase of 2.9 percent. Carnival, which had to close operations due to the corona pandemic, wants to improve its liquidity. In the past two trading days, the Carnival rate had fallen by 28 percent, in the past three months the minus has totaled 75 percent.
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