Effect of coronavirus on Bitcoin and U.S. Stocks

Effect of coronavirus on Bitcoin and U.S. Stocks

Coronavirus has become buzzing word to the people across the world creating a horrendous alert. Though the world economy is affected by the incidents taking place in the world, the coronavirus is affecting stock market sell-off and flight to safe-haven assets like gold and U.S. Treasury bonds. Bitcoin price climbed up 1.4 percent rising along with popular cryptocurrencies. Treasury yield in the U.S. stocks market is low and gold prices were little changed close to a seven-year high.

A warning came from analysts that this contagion could hamper factories’ supply chains, dampen demand for exports and stunt economic fate in China, the U.S. and elsewhere. As the virus is becoming worldwide, it is becoming a matter of thought to the people across the worlds because it is a threat to world economy. Global markets are reportedly heading towards historic lows and set at negative levels in Europe and Japan. It is assumed that, the economy won’t lift up until the Chinese economy backs to its previous state. According to analysts situation is getting worse saying U.S. Treasurys are the optimal choice of perceived safe-haven protection. 

The U.S. economy faces a new risk because of this contagion which keeps the president of U.S. at risk of reelection chances. Trump said through a tweet that fake news media outlets were doing everything possible to make the coronavirus look as bad as possible. The sell-off of the week in the S&P 500 left index down 7 percent in the U.S. stocks in the year. The yield on the 10-year U.S. Treasury note declined down by 0.02 percentage point to 1.29 percent.

The prices of Bitcoin fell to $8,627 on Wednesday this month but Bitcoin was counted as a safe haven from financial panic however the currency also got affected. But as on Thursday, the cryptocurrency’s price rebound, some hopes returned. An investor said bitcoin appears entirely uncorrelated with other asset categories like stocks, bonds and so investors should put minimum amount of assets into Bitcoin.

Spread the love

Leave a Comment

Your email address will not be published.

Scroll to Top