As the coronavirus continues to ravage global markets, the financial markets have seen some of the utmost volatility in trading.
The global markets rose on Wednesday, giving a signal that the stock market might be breaking away from its helpless collapse with the return from losses experienced by the oil prices.
The crash of the oil market had weakened the investors, but on Wednesday, oil benchmarks prices showed signs of stabilizing.
The West Texas Intermediate, a significant oil benchmark, was flat to positive although at a low level of about $11 a barrel during the early European trading.
Brent crude oil, the international benchmark accounting for two-third of the world, was down more than another 11% Wednesday morning at $17.10 a barrel, with the overnight barrel price at less than $16, which takes the price to the lowest in more than two decades.
European stocks opened higher after some Asian markets turned positive near the end of their trading day.
The opening of Wall Street also pointed to the green from the future markets.
In London, the FTSE 100 index was up by one per cent in the early trade. In Germany, DAX opened 1.1 per cent higher, while France’s CAC 40 index was also increased by 0.6 per cent.
The Russian stock markets were quiet in comparison with the RTS Index and MOEX Index, giving an indefinite gain of 1.5% and 0.8%, respectively.
The U.S Treasury bond prices also fell, since it is known that the falling prices in the Treasury bond boost yields, which means a low/no risk positions for investors.
This signifies that the markets were favouring stashing money in places considered less conservative.
In the Asian market, South Korea’s Kospi was increased by 0.9 per cent, the Shanghai Composite index in mainland China rose by 0.6 per cent.
Furthermore, the Japan stocks opposed the trend, with the Nikkei 225 index falling 0.7 per cent. Hong Kong’s Hang Seng rose by 0.4 per cent.
One of the major Australian markets opened at 5,221.20 from the 5,353.00 is closed with on Monday.
The exchange rate also saw some changes today, as the Pound takes a sizable hit and, surprisingly, the dollar higher as crude oil was at a two-decade low.
The GBP/USD, cable as it is fondly known, took a hit on Tuesday as risk-off conditions (investors shift from high-risk investments to low-risk investments) pushed the sensitive Pound Sterling barely into the 1.22 handle.
Cable exchange rate is +0.11 per cent higher at $1.2314. The exchange rate can be attributed, in part, to the plunge in the oil prices and the non-extension of the Brexit June deadline blueprint talks.
The United States Dollar was stronger even as oil price collapsed once again, this time around with the June contract reaching $7 bbl.
The effects of the fall weighed more on the stock market, with a couple of indices per cent lost by the major indices.
The U.S Dollar, Greenback, did not suffer loss as investor’s craving for cash shoot up.