Market Outlook Report – April 2020

Market Overview

​April  2020

US oil price plunges to 20-year low as coronavirus hits demand

Following on from the largest oil supply agreement in history, prices have continued their volatility, with the latest sharp fall driven by the impending expiration of the WTI futures contract. Demand for Oil has reached new lows, as production lines and economies have ground to a halt globally

Relevance/ Impact 

Economic impact of Coronavirus puts pressure on UK Governments lockdown measures

The Prime Minister is reluctant to ease the UK’s lockdown too soon, resisting pressure to open the country again as national cases slow. The UK economy has effectively ground to a halt after the country was put into lockdown, with a recession looming and 1 in 5 employees now accessing the governments job retention scheme.

Relevance/ Impact 

China's virus-hit economy shrinks for first time in decades

Friday’s figures (17.4.20) show China suffered a 6.8% contraction as the export driven economy felt the brunt of domestic lockdowns disrupting production as well as worldwide lockdowns and job losses causing huge declines in consumer demand.

Relevance/ Impact 

Coronavirus is dealing a devastating blow to already suffering sector

With the retail sector already suffering a tough 2019 as consumers move away from physical high streets in favour of online shopping, the forced closures of shops and hit to consumers confidence as well as their wallets, has brought many retailers to breaking point.

Relevance/Impact

European countries easing restrictions

As the data shows the slowing of the virus across the continent, many European countries have begun actioning plans to relax the distancing measures and re-opening businesses in an attempt to kickstart the economy.

Relevance/ Impact 

​References

FT, 20th April (US oil price plunges to 20-year low as coronavirus hits demand)

FT, 11th April (G20 backs largest oil supply agreement in history

Guardian, 17th April (Coronavirus 'under control' in Germany, as some countries plan to relax lockdowns)

Bloomberg, 20th April (U.K.’s Johnson Resists Easing Lockdown on Fears of Second Wave)

ITV News, 19th April (Ending social distancing ‘risks second wave of Covid-19 deaths in UK’)

Guardian, 14th April (UK economy could shrink by 35% with 2m job losses, warns OBR)

BBC News, 17th April (China's virus-hit economy shrinks for first time in decades)

BBC News, 18th April (Green’s retail empire could close over 100 stores)


Disclaimer: This document represents the opinion of Reeves Independent only and is not intended as advice and no investment decisions should be made solely on the back of this email. Always seek independent financial advice before taking any action. Past performance is not a guide to future performance. All investments carry the risk that you will get back less than you put in.