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Year to date performance of the most important financial instruments

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Miguel A. Rodriguez
Miguel A. Rodriguez
14 September 2020
The pandemic still rules over the markets

The American Benchmarks

It is well known that the pandemic put a stop on everything, the financial market included. The pandemic caused a collapse in stock prices, which made the benchmarks to reach new lows, and later on, new highs. 

According to various senior market analysts from S&P, the USA500 lost $5.3 trillion in wealth in less than a month. The loss happened at the peak of the pandemic, between February 19 and March 9.

During the pandemic, USA30 and USA500 marked their most significant loss, at 4.4%. At the same time, TECH100 dropped 4.6%. All three benchmarks finished more than 12% below their record close on February 19. 

But as time went by, the market started to recover as more and more money was injected into the battered economy. TECH100 closed at a high of 10,000 on June 9 for the first time since February's low, and on August 6 it closed above 11,000. 

During the first quarter of 2020, the USA500 index reported a 20% decrease - marking the most significant quarterly loss since 2008. However, during Q2, it managed to fully recover, the 20% increase marked the most significant quarterly gain since 1998. It reached a new record on August 18. 

In the first quarter of 2020, USA30 lost 23% - the worst quarterly decline since 1987. Despite the gains between 0.10% and over 2%, the index is still down more than 2% from the beginning of the year. 

Gold

The safe-haven asset amazed the world in the first half of 2020. After the pandemic took over the world, investors turned to Gold, which made it overperform other major asset classes. Since the beginning of the year, it added roughly 30%. At the beginning of August, it managed to pass the $2,000 threshold for the first time. The rally was boosted by a spike in the number of #COVID-19 cases and the US Congress' inability to reach a deal regarding a stimulus package. 

But as time passed, the investors returned to stocks, which made Gold lost some steam, returning to prices below $2,000 per ounce. During the second quarter of 2020, Gold gained more than 9%. In the first half of the year, the price gained around 28%.

Oil

The product that makes the world go round had a tough six months. A mix between the zero demand during the pandemic and the disputes between OPEC and Russia, made Oil lose 11% in just one day. But that was just the tip of the iceberg, as the price continued to drop until it reached a negative value for the first time in history.  #Oil traded at -$37 per barrel (for futures contracts). In May, as demand picked up, it recovered more than 90% of its value. 

However, as COVID-19 infections emerged once again, demand fell. It is currently trading at around $42/barrel, but since the beginning of the year, it has lost about 30%.

Read all about what happened during the pandemic on CAPEX.com!

Sources: bangkokpost.com, washingtonpost.com, nasdaq.com, cnbc.com


This information/research prepared by Miguel A. Rodriguez does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. The research analyst primarily responsible for the content of this research report, in part or in whole, certifies that the views about the companies and their securities expressed in this report accurately reflect his/her personal views and consequently any person acting on it does so entirely at their own risk.The research provided does not constitute the views of KW Investments Ltd nor is it an invitation to invest with KW Investments Ltd. The research analyst also certifies that no part of his/her compensation was, is, or will be, directly, or indirectly, related to specific recommendations or views expressed in this report.The research analyst in not employed by KW Investments Ltd. You are encouraged to seek advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit that conforms to your specific investment objectives, financial situation, or particular financial needs before making a commitment to invest. The laws of the Republic of Seychelles shall govern any claim relating to or arising from the contents of the information/ research provided. 

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Miguel A. Rodriguez
Miguel A. Rodriguez
Financial Writer

Miguel worked for major financial institutions such as Banco Santander, and Banco Central-Hispano. He is a published author of currency trading books.