US Equities fall as fears over the Coronavirus spread. The extent as to which the virus has truly reached is unknown with two total confirmed cases in the United States. Meanwhile around the world, new cases have emerged with two cases of the virus reaching France. Chinese officials are trying their best to contain the virus. In China, there are already more than 830 cases and at least 26 people have died. 8,420 people are reported to be under observation. In total, France, South Korea, Japan, Nepal, Thailand, Singapore, Vietnam, Taiwan and the United States have all confirmed cases of the virus.
What does this mean for markets?
If this situation escalates, there is a fear that it will disrupt economic supply chains. A large enough disruption could trigger bearish sentiment in the market and turn to a modest downturn. It seems that many analysts saw equities as fully priced back in August 2019 when a sharp correction threatened the Bull Market. Since then, investors have gotten more bullish off corporate guidance and the US-China trade deal. It seems that the media has been selling the news of the pending US-China trade deal and have led the market to greater heights in anticipation. Now the news seems to have turned sour with this breakout virus grabbing the headlines.
Will this present an opportunity to buy or more trouble ahead?
We will find out.