The FTSE 100
has steadied again but investors remain extremely jumpy. Dip-buying
activity remains thin on the ground as market makers consider the
possibility of a second stock market crash.
It’s
impossible to say with any degree of certainty whether another crash is
around the corner. But there’s certainly plenty of potential problems
that could cause a fresh financial market meltdown. Here are three
reasons why a second share market collapse could happen sooner rather
than later.
The
easing of lockdown restrictions across the globe have allowed stock
indexes to creep steadily higher from their March troughs, leading to
hopes of swift economic improvement.
Have
politicians been too quick in lifting restrictions, though? A
subsequent secondary spike in coronavirus cases has led many to believe
that the answer is ‘yes.’ Parts of China have had to be locked down
again in recent days. Infections in some parts of the US continue to
balloon. And today the World Health Organisation said that it has seen a
resurgence of cases in more than 20 European countries.
News
flow has led to speculation that efforts to steadily ease lockdown
restrictions could be slowed. Some are suggesting that strict quarantine
measures could be re-introduced in a move that would deal a bodyblow to
the economic recovery and likely cause another market crash.
Second stock market crash – 3 reasons why it could be coming, and what I’d do right now
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