Market comment | Virus spread maintains pressure on equity markets

Risk-off mood intensified on Monday, underpinned by the multiple outbreaks of the Coronavirus epidemic (COVID-19) outside China. In this context, investors sought shelter in safe haven assets, with gold prices reaching seven-year highs.

Key points

• Key points:
• Italy imposed strict quarantines across at least 10 towns as the number of infections rises.
• German business sentiment showed resilience against global risks.
• Sovereign bond yields plunged across the board with the U.S. long-term yield reaching record lows, while Italy’s risk premium widened significantly.
• Equity markets tumbled worldwide, whereas declines were more contained in Asia. VIX 23 +6 points.

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