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Economic Recovery?

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The travel restrictions and lockdowns to contain the spread of the coronavirus curbed global fuel use cause the oil price drop.  The oil-generating countries' plan to reduce production, which will help restore the balance between supply and demand in the oil market.  Oil prices rebound after plummeting to historic lows.

Implementing economic stimulus measures by governments of various countries includes lowering interest rates, increasing government spending and quantitative easing.  Resumed work earlier than expected.  US stocks Dow Jones Industrial Average (DJI) recently reached a high of 27572 not far from the highest point of 29551 in February 2020.  Can stimulus save the global economy from Covid-19?

It may need more attention to:

  1. The second wave of COVID-19

The world recorded about 150,000 new cases recorded the day before was the highest in a single day -- and nearly half of those were in the Americas.  The world enters 'dangerous phase' with coronavirus: World Health Organization (WHO) said on June 19, 2020.

  1. No medicine

An emerging disease with no medicine can be surely cured; however, all countries rushed to unblock

  1. No vaccine

The new pathogens and the majority of people are not immune at the moment, and no vaccinated is available.

  1. No honesty

Many governments, for political purposes and economic benefit, have their own opinions on the epidemic.

  1. Tension between countries

U.S.-China tensions, deteriorating relations between North and South Korea, Sino-Indian border conflict.

  1. The political situation in the country

The American riots, and China’s Street vendor economy

Although the stock market and oil prices are close to the highs at the beginning of the year, the fundamentals and the real revenue of the company have not changed. Be careful that recent fluctuations do not rule out a short-lived.  The non-agricultural employment population increased by Although the stock market and oil prices are close to the highs at the beginning of the year, the fundamental nature of the company and the real revenue have not changed. Be careful that recent fluctuations do not rule out a short-lived. 2.5 million in May, but it still cannot compensate for the large-scale unemployment wave since February, but it has given the market some confidence.  If the second wave of epidemics recurs, the unemployment rate that announced in July increase, which may affect the economic rebound of various countries.  The fiscal and monetary assistance of various countries may need to be more active.

The reopening speed of countries, consumer behavior, consumer confidence, and uncertainties about the global economic outlook may challenge the recovery of the economy and the stock market.  There will be more economic fluctuations in the future, especially the possibility of a virus outbreak.  Although the economy has reopened and the situation has improved, the market seems to overestimate the speed of economic recovery.  The situation is uncertain whether it will continue to develop in a positive direction, so we should maintain a cautious attitude towards the financial market in the short term.

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