Markets Go Through Another Shakedown

The US Federal Reserve launched its much-awaited Main Street Lending program to help the economy to cope with the strains caused by the pandemic offering up to USD 600 billion in loans

Over the last few weeks, China reported an increase in new infected coronavirus cases in the city of Beijing. This further led towards lockdown being implemented in Beijing as well as suspending schools. Alongside, a rise in number of new cases being reported in the US was also reported. As a result of this fresh wave, global investors’ sentiments were tampered with concerns, thus creating a negative impact for the global economy once more. During the fortnight, Shanghai index gained by mere 0.35 per cent owing to weaker investor sentiments over rise in the country’s geopolitical tensions with India and also because the Chinese government re-imposed travel bans in the country following the resurgence in cases of new coronavirus. Despite the situation, Hong Kong remains very optimistic that China will be able to control the spread of new infections as it successfully did with the first wave, leading to the Hang Seng index rising by 1.45 per cent.

Bank of Japan left the key lending rate unchanged and maintained its yield curve control and quantitative easing program, further expecting the economy to positively recover from the ongoing slump leading to Japan’s Nikkei index gaining by 1.15 per cent in the last few weeks.