Stock markets in freefall and it seems unlikely central banks and governments in the short-term can do anything. Technical selling is getting ugly and even though expectations are high the Fed will take rates to the zero bound, the retail investor will likely want to wait this one out. It seems the collapse with oil prices have added a log to the deflationary fire the Fed will try to extinguish. Virus fears, deflationary risks, and growing stress in the credit markets, means markets will see the Fed launch a new QE program very soon.
Eventually investors will start scaling back into stocks, but it seems the technical selling can remain ugly for a couple more days. The longer-term playbook will likely to buy stocks again as markets will move beyond the virus, adjust to lower oil prices, and expect a wrath of global stimulus likely to remain in place over the next year.
Oil
Saudi Arabia and Russia basically said…
