This archive report was first published on 20 April 2020.
As the world struggles to contain the COVID-19 pandemic, global markets have been severely impacted. The week of April 13-17 was marked by a shortened trading week due to Easter holidays, but markets remained optimistic about the potential easing of social distancing measures.
Investors were faced with a daunting task of weighing record economic downturns against the possibility of a partial reopening of global economies. The situation was further complicated by the uncertainty surrounding the storage of excess oil supply, which led to a significant drop in crude oil prices.
On Tuesday, major banks reported their first-quarter profits, with JP Morgan Chase and Wells Fargo experiencing declines of 70% and 89%, respectively. The Bank of Canada maintained its key interest rate at 0.25% on Wednesday, announcing additional stimulus measures that were positive for the USDCAD.
Thursday saw a surge in US unemployment claims, reaching 22 million in four weeks. The US Department of Labor reported initial jobless claims for the week ending April 11, which fell by 1.37 million to 5.25 million. Morgan Stanley estimated that the figures would gradually begin to fall in the coming weeks as firms factor in the impact on business operations.
On Friday, China released its Q1 2020 GDP figures, recording a decline of 6.8% in the three months to March. This marked the first decline in 28 years of reporting quarterly GDP figures, signaling a potential performance of the global economy in Q1 2020.
