Capital Ideas

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World Markets Review
Coronavirus jolts global markets in the first quarter

Global stocks fell sharply amid a severe coronavirus outbreak that brought the world economy to a virtual standstill. A decade-long bull market in U.S. equities came to an end as investors feared the widening pandemic would spark a global recession. Governments around the world responded with unprecedented monetary and fiscal stimulus measures.

Energy stocks experienced the biggest declines as a demand shock and a price war between Saudi Arabia and Russia sent oil prices plummeting. Financial stocks also suffered large losses as some banks suspended dividend payments to conserve capital. All sectors fell, but technology stocks held up the best and health care stocks also fared relatively better, including select drug companies working on potential coronavirus treatments. Growth stocks outpaced value stocks by a wide margin.

U.S. Treasuries rallied as demand soared for perceived safe-haven assets, while corporate bonds declined as several high-profile issuers lost their investment-grade credit ratings.


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