Market Brief – Monday 2/10/20

With news outlets reporting the Coronavirus is less of a threat than the common flu, American investors jumped in to buy the overnight dip in stocks, which pushed the major indices near their all-time highs. Treasury yields aren’t buying the optimism as yields fell in early trading. Oil and gas producing stocks were down early as crude oil was struggling was trading below $50 per barrel.

Consumer prices in China continue to rise as their CPI rose +1.4% in January and +5.4% from this time last year. Rising consumer prices will force the Bank of China to limit its monetary easing.

Italian industrial production fell -2.7% in December and -4.3% from this time last year, an indication the global economy was slowing ahead of the Coronavirus outbreak.

The New York Fed accepted bids for $38.2 billion of overnight dollar loans and purchased $2,201 billion of Treasury Notes against offers of $4,983 billion.

The Baltic Dry Index, a proxy for global shipping demand, fell to fell to its second-lowest level in history as shipping demand collapses.

Stocks were panic bid in the final hours of trading and Treasury yields rose in the last hour of trading, but still closed lower on the day. Crude oil closed below $50 per barrel which sent small oil and gas producing stocks lower.