Coronavirus mutates - strong sell-off on stock exchanges

While we all expected the stock markets to return to their uptrend permanently with vaccination, a mutation in the coronavirus has emerged in the UK. It is already known that it is about 70 percent. more infectious than the original version of the Covid-19 coronavirus, but it is not yet known whether it will respond to the vaccine and how the disease will pass through it. The stock market reacts with declines.

St. Nicholas, or maybe the approaching one "January Effect"? None of that, at least not yet. After news from the UK about a dangerous mutation of the coronavirus, the financial markets are seized with fear again. 

Indexes peak around the world

All over Europe, stock exchanges have opened up to considerable disadvantages. German DAX and the British FTSE 100 already lost more than 2 percent in the morning, and the French CAC 40 even 2,5 percent. From 11 an international conference is underway on the new variant of the coronavirus, the expected symptoms of infection with it and, above all, treatment plans. It doesn't change much. At noon, the DAX is down 3,7%, the CAC 40 is 3,4% and the FTSE 100 is 2,9%.

The US indices are also on the downside. The agreement of Democrats and Republicans on the next economic package did not help. The entrance didn't help either Tesla to the main stock exchange index S & P500. Contracts on S & P500 they are currently 1,3% in the red with no improvement.

The Polish WIG20, which started with a 1,5% drop, and then was much worse, does not stand out from the European markets. Before 12, the decrease was 4,5%! Smaller companies are doing slightly better, but their price is also falling. 

W20 chart (CFD on the WIG 20 index), D1 interval. Source: xStation

Dynamic movements in the Forex market

A lot is also happening on Forex currency market. EUR / USD drops to $ 1,22. The British pound is also falling, and it is cheaper against virtually all other currencies, including the euro and the US dollar.

After all, it is also interesting on pairs with PLN. It was hot already on Friday when it turned out that the National Bank of Poland made an intervention aimed at weakening our currency for the first time in 10 years. It is not known whether this is due to actual actions or more psychological reasons, but the fact is that the zloty is weakening against both the US dollar, the euro and the Swiss franc. Only against the British pound the exchange rate is relatively stable, because the British pound is also cheaper - mainly due to the fact that the new variant of the coronavirus is at the heart of the UK.

Crude oil gets cheaper after increases

Dynamic drops also in the crude oil market. But in this case, the price of black gold can certainly be influenced by the last few weeks that have taken the price up oil. Over the past month, crude oil increased by 15%, so the current declines could be expected, and the impulse only helped to fulfill this scenario. On Monday, December 21, 2020, Brent crude oil cheaper 5,5%, and WTI by 5,7%. Copper prices are also falling, and they are again succumbing to the sellers' pressure - this time by over 2,1%. Platinum drops by as much as 6%. Even gold and silver, which started the day well, are already under the line and are down 0,3% and 0,2% respectively.