Markets: Shifts have been fast and gut-wrenching but not irrational – Morgan Stanley

FXStreet Team FXStreet

We’re living through a period of unprecedented market volatility as well as remarkable velocity of price movements. Lisa Shalett, a Chief Investment Officer at Morgan Stanley, analyzes the market shifts.

Key quotes

“Too few buyers, when nearly every asset class is declining in price, is a recipe for the kind of extreme volatility across asset classes we’re seeing lately.”

“Our global-growth forecasts have also come down, and we foresee a global recession for the first half of 2020, followed by a recovery in the second half, with fourth-quarter GDP growth of more than 2%.”

“Market shifts have been fast and gut-wrenching, but not completely irrational. The worst economic damage can be confined to the second quarter, setting the stage for a healthy rebound into 2021. The next three weeks could be critical to assessing the damage and the repairs ahead.”

Author

FXStreet Team

FXStreet

EUR/USD climbs to daily highs near 1.1820

EUR/USD now picks up pace and advances to the area of daily peaks north of the 1.1800 barrier at the end of the week. The pair’s decent move higher comes against the backdrop of a generalised lack of direction in the FX galaxy and the mild offered stance in the US Dollar.

GBP/USD trims losses, retests 1.3460

After briefly challenging its key 200-day SMA near 1.3440, GBP/USD now manages to regain some balance and revisit the 1.3460 zone on Friday. Cable’s pullback comes as the selling pressure on the Greenback gathers traction, reigniting some recovery in the risk-linked space.

Gold flirts with four-week highs past $5,200

Gold extends its rebound, climbing for a third consecutive session and pushing back above the $5,200 mark per troy ounce on Friday. The move higher continues to draw support from lingering geopolitical tensions and the ongoing uncertainty surrounding US trade policy, both of which are keeping safe-haven demand firmly in play.

Iran escalation: Quick thoughts on markets

Markets are likely to open the week with risk-off, with declines led by airlines, cyclicals and trade-exposed names, while energy, defense and “strategic” sectors may be relatively steadier.

Oil at a critical breakpoint: Will geopolitics trigger the next major move?

The week ahead blends two powerful forces: moderating economic momentum and increasing geopolitical tension. While US and Eurozone data suggest steady but unspectacular growth, rising friction between the US and Iran is injecting a fresh risk premium into energy markets. Macro is softening but geopolitics may dominate price action.

Starknet unveils strkBTC, shielded Bitcoin transactions on Ethereum Layer 2

Starknet, the Ethereum Layer 2 network developed by StarkWare, today announced strkBTC, a wrapped Bitcoin asset that introduces optional shielding while preserving full DeFi composability.