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The ‘Panic Effect’ is Back: 5 Key Factors for Thursday’s Markets

© Reuters.

By Laura Sanchez – Fears of a recession and the fall of the Nasdaq dragged down the rest of the US indices yesterday, which in turn dragged down Asian markets this morning. Europe reacts in tandem.

Corporate earnings season continues.

Oil prices are higher.

Cryptocurrencies fall this morning.

These are the five factors investors should consider when making their decisions today:

1. The ‘panic effect’ turns the markets red

Fear returns to the stock markets, after yesterday’s sharp fall on Wall Street due to the collapse of technology companies and fears of recession. Morgan Stanley raises this probability from 5% to 27%.

2. ECB minutes; De Guindos speaks

This Thursday we will be watching the minutes of the European Central Bank’s latest monetary policy meeting, which will be released at 07:30 am ET (1130 GMT). Luis de Guindos, Vice President of the European Central Bank, will also appear at 08:30 am ET (1230 GMT).

The focus remains on the more than likely interest rate hike in the July meeting.

3. Cryptocurrencies on the decline

The cryptocurrency sector continues to fall, along with the stock market, and has yet to recover from the heavy losses suffered last week after the collapse of Terra (LUNA). Bitcoin is trading at $29,000 and Ethereum at $1,900.

4. Asia and U.S. markets

The main Asian indices are negative today. Nikkei fell by 1.7%. Hong Kong’s Hang Seng is down 2.2% and the Shanghai Composite is flat.

On Wall Street, the market also ended yesterday in the red. The S&P 500 (-4%), Nasdaq (-4.7%) and Dow Jones (-3.6%) closed down.

5. Macroeconomic data

The main macroeconomic references in Europe include the construction sector production and the current account in the eurozone.

In the US we will see new jobless claims, existing home sales and Natural Gas Storage.

Follow the day’s events on our economic calendar:

The ‘Panic Effect’ is Back: 5 Key Factors for Thursday’s Markets

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