Last but not least, the Coronavirus outbreak has caused significant upheaval and carnage on global markets. Global stock markets such as the Dow, S&P 500 and the FTSE 100 have had some of their worst weeks in history with billions wiped off due to the uncertainty and fear over Coronavirus. Consumer confidence has been dented and this thus leads to a fall in consumer spending and thus falling revenues, profits and dividends for firms. This will culminate in stocks on these markets falling in value. Due to uncertainty surrounding the markets, comments on social media platforms alter each day throughout the hours and can in fact have an impact on stock price fluctuations. Modern technologies now allow for real-time market sentiment monitoring platforms like StockGeist.ai to observe said changes in the market psychology. People also have the chance to enhance their own project with integrating stock news sentiment API.
However, the widespread impact of the virus, tied with its growing spread and lack of solution has sent markets into overdrive where we have seen major swings and high levels of volatility. For context, in the second week of March, the Dow saw its biggest one day decline and the S&P 500 (a stock market index) wiping out its entire gain for 2019 within 2 weeks and is down 30% from it's all-time high. While there have been various cases in the past of such decline and volatility e.g. 2008 crisis, dotcom crisis, there has never been a situation like this where entire economies are shutting down and more importantly, a crisis where we don’t know the full extent and where the end will be. With the virus not fully piercing through (statistically) in countries such as the UK and US, the potential for further drops is high. While stock market crashes may seem like something not important to the everyday person, there can be knock-on effects. Millions of citizens’ pension funds invested in stock markets, so severe declines in stock markets can see billions of people’s pensions and savings wiped off from falls in markets.