In Asian Equity Markets stocks in Japan saw sharp declines on Tuesday following an overnight decline on Wall Street as fears of the economic impact from the coronavirus outbreak spread. The Nikkei 225 fell 3.97% in early trade, before easing to losses of 3.36% as shares of index heavyweight Fast Retailing declined more than 4%. The Hang Seng index in Hong Kong shed earlier gains to slip 0.11%. Meanwhile, shares in Australia declined as the S&P/ASX 200 fell 1.1%.

 

In Currency Markets the US dollar checked its march higher on Tuesday, as investors sharply raised bets that the growing fallout from the coronavirus outbreak would prompt U.S. interest rate cuts. That helped to stay a steep slide in Asian currencies that has accompanied the virus’ recent rapid spread beyond China and allowed the pound and euro to drift slightly higher. The Australian and New Zealand dollars were each about 0.2% stronger against the greenback. The Chinese yuan rose 0.2% and the Korean won mostly recouped heavy losses made on Tuesday.

 

In Commodities Markets oil steadied on Tuesday as investors sought bargains after crude benchmarks slumped almost 4% in the previous session, although concerns about the coronavirus spreading out of China denting major economies and curbing fuel demand capped gains. Brent crude rose 19 cents, or 0.3%, to $56.49 a barrel, after slipping 3.8% on Monday, the largest single-day price fall since Feb. 3. U.S. crude futures gained 17 cents, or 0.3%, to $51.60, recovering from a 3.7% drop in the previous session.

 

In US Equity Markets indices fell on Monday as investors ran for safety after a surge in coronavirus cases outside China fanned worries about the global economic impact of a potential pandemic. The technology heavy Nasdaq had the biggest percentage decline, down 3.71%. The S&P 500 lost 3.35%, to 3,225.89. All of the 11 major S&P sectors closed in the red, led by the energy sector’s 4.7% decline. Apple Inc slid 4.8% as data showed sales of smartphones in China tumbled by more than a third in January.

 

In Bond Markets U.S. Treasury yields fell on Monday to their lowest levels since 2016 as investors sought safety in government bonds amid fears the coronavirus epidemic could do more economic damage than predicted. The curve inversion between the 3-month and 10-year bond yields also deepened in what has been seen as a potential recession signal. As investors sold stocks and rushed for safe-haven assets, the 10-year Treasury yield was down 11.6 basis points to 1.3538% after earlier hitting 1.352% – its lowest since the summer of 2016.

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