Market Update from the Global Asset Allocation team – February 2020

Just as one source of investor angst faded at the beginning of 2020, another intensified. After simmering trade tensions fueled a blockbuster start to the year, sentiment took a turn for the worse after the outbreak of the Wuhan coronavirus threatened to derail an already-fragile global growth backdrop. The epidemic, and efforts to contain it has forced investors to reassess the outlook for the world’s second-largest economy and by extension, global growth prospects. Importantly, Chinese policymakers responded swiftly with new measures to stem the damage to both financial markets and the economy – though uncertainty is surely to prevail in the near-term until the virus has been contained.