The fears of the stock markets exist on two levels. First is the emotional and indeed personal fear of the Coronavirus while the second set of fears are founded on economic and financial projections, according to FXStreet’s analyst Joseph Trevisani.

Key quotes

“The key to market fears is time. How long will the social and employment restrictions remain in place? How far and for how many weeks will it collapse consumer demand? No one knows the answers.”

“The greatest market fear is that the collapse in consumer spending will be so vast and so devastating to existing businesses that many will vanish with no possibility of recovery.”

“Markets will have to absorb many awful statistics in the weeks ahead as the extent of the damage is spelled out but the immediate economic calamity will matter less than the future once the market is convinced the corner has been turned in the pandemic.”

“We are back to the market’s emotional response. No matter how rational and analytical the view, no matter how convinced traders are that the virus will subside they are unlikely to fully act on those beliefs until they see proof in the medical statistics. It's only human.”

 

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