Daily Market Color

President Trump Warns Markets of Possible Recession


US markets brace for a recession. President Trump hinted the US was headed towards a recession caused by “an invisible enemy.” Treasury Secretary Steven Mnuchin is pitching Senate Republicans on an $850 billion stimulus package to cushion the virus impact. The package includes $50 billion for the airline industry in addition to a large general stimulus with a potential payroll tax cut. Mnuchin is also aiming to increase the amount of available tests and providing paid leave to hourly workers. Senate Minority Leader Chuck Schumer will also propose his version of a stimulus package worth $750 billion. Despite the Trump administration’s efforts, the markets reacted negatively due to fears of a recession. The DJIA dropped nearly 3,000 points – the steeping decline of the index in the past volatile month. The US 10-year Treasury yield fell in response and currently sits at 0.801%.



Global governments are ramping up efforts to curb the virus impact on their economies. IPresident Macron pledged 300 billion euros in bank loans to French struggling businesses. Germany, Britain, and the Netherlands have also announced expanded measures for business like partial unemployment packages. Asian countries like Singapore and Hong Kong are noticing a second wave of infections, as the number of confirmed cases are growing rapidly.



Day ahead. US retail sales for February fell 0.5% despite economists predicting a 0.1% rise. US business inventories for January are expected to fall 0.1% M/M. The National Association of Home Builders housing market index for March is expected to remain unchanged at 74. President Trump Is set to meet with restaurant executives, tourism industry executives, and retailers throughout the day. The White House virus task force will hold their daily briefing.


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