SINGAPORE (June 12): Financial markets, which were poised to enter the second half of the year with a “second wind” beneath the wings, have been doused with cold water. The spectre of a “second wave” of Covid-19 cases has grown as more locations lifted lockdowns in varying degrees, thereby allowing the virus to spread.
This past week, three major US states reported a higher number of confirmed Covid-19 cases. A month into its reopening, Florida reported 8,553 new cases — the highest weekly number to date; California’s hospitalisations are at their highest since May 13. And on June 10, Texas reported 2,504 new cases, the highest one-day total since the Covid-19 outbreak started.
Earlier in the week, market experts were betting on a “second wind” to carry markets even higher. The “wind”, of course, is generated by the unprecedented trillions in stimulus from policy-makers and central banks across practically every major economy.