More Volatility for Stocks This Week?

March 9, 2020
363 Views

Confidence in the stocks market came back briefly last week, but investors could now be in for more volatility. The Coronavirus continues to be a market headwind. Its spread is becoming more serious in the United States. Oil prices have also slumped, with fears of an all-out price war.

Here’s what investors need to be aware of for the week ahead.

Coronavirus is Spreading in the U.S.

With increased detection rates in major cities, the Coronavirus is becoming a more serious threat to the domestic economy.

Recent announcements help to show just how widespread the problem has become.

  • The CDC has announced 164 cases and 11 deaths.
  • Columbia University has canceled all classes after a student was diagnosed with Coronavirus.
  • New York City Mayor Bill de Blasio confirmed thirteen cases in his city.
  • Schools in Long Island, New Jersey, Connecticut, and New York have canceled classes this week.
  • California has declared a State of Emergency after its first death and more than 20 confirmed cases of infection.
  • Senator Ted Cruz has entered a voluntary home quarantine after learning that he was exposed to Coronavirus at a recent American Conservative Union conference, where other high profile politicians, including the President, were in attendance.

News is developing quickly. Detection rates in China, where the virus originated, have begun to slow down, but the rate of spread in Italy, the United States, and South Korea is increasing.

If the virus continues to spread, it could disrupt consumer spending, business output, and the overall U.S. economy. This could lead to poor performance in the stocks market.

What’s Happening with Oil?

Oil prices fell significantly last week, with some analysts believing that producers are now in a race to the bottom. OPEC and other major oil producers, including Russia, met last week to discuss output cuts to stabilize global prices. Russia reportedly rejected the plans, which has triggered falling prices.

Saudi Arabia, the largest producer in the OPEC alliance, is reportedly now increasing its output to 11 million barrels per day. With more oil flooding the market, West Texas Intermediate, the major U.S. oil benchmark, had its worst weekly drop in 6 years.

Low oil prices can benefit consumers but are bad news for producers and investors. This could disrupt the markets this week.

Stocks Keep up to Date with the Latest Financial News

The rapid development of these stories only reinforces the fact that it’s important to stay up to date with the latest financial news. Volatile markets can create strong buying opportunities, especially with some key stocks as undervalued as they are today.

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