- Risk-off is in full swing in Asia with the major indices reporting notable losses.
- Gold and other haven assets are attracting bids.
- Coronavirus cases outside China are increasing, forcing investors to shun risk.
The US equity index futures are flashing red along with the Asian shares while gold is gaining ground on reports showing the number of coronavirus cases outside of China has increased.
At press time, the futures on the S&P 500 are down 1.28% or 42 points, while Australia's ASX 200 and South Korea's Kospi are shedding 2% and 2.58%, respectively.
Gold is currently trading at $1,662 per Oz, representing a 1.12% gain on the day, having hit a high of $1,681 an hour ago.
In the FX markets, the South Korean won is facing selling pressure. The currency fell to 1,218.35 against the dollar, the weakest since August earlier today.
The anti-risk yen, however, has erased early gains, as evidenced by USD/JPY's recovery from 111.27 to 111.57.
The flight to safety could be associated with the emergence of clusters of infection in new countries including South Korea, Italy, and Iran, as noted by the Wall Street Journal.
South Korea has reportedly seen a 20-fold increase in the number of infections in the five days. Meanwhile, Italy canceled some public events after coronavirus infections rose to 140 despite lockdown in the North. Additionally, reports are doing the rounds that millions of small businesses in China are facing a cash crunch may collapse if banks don't act.
The risk sentiment may find some relief if the Chinese authorities step up policy support to help cushion the blow to the economy from a coronavirus outbreak
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.