Five market shocks of H1 2020
Here, Money Management, rounds up the most impactful events of markets of the first half of the year. Click here to read the events of the second half of the year.
11 March 2020: COVID-19 classified as pandemic
On 11 March, the COVID-19 virus was officially classed by the World Health Organisation (WHO) as a pandemic. Countries reacted by shutting borders, imposed travel restrictions and introduced restrictions on work and school activities. Since this date, some 908 people in Australia have died and the total number worldwide surpasses 1.4 million.
After initial gains of 7% at the start of the year, the ASX 200 lost 20% during March.
19 March 2020: RBA cuts rates to 0.25%
Hot on the heels of the pandemic announcement, the Reserve Bank of Australia (RBA) cut interest rates to a record low (at the time) of 0.25% and introduced quantitative easing (QE). A common monetary policy in the UK and the US, it was the first time QE had been used in Australia. Rates were later cut even further to 0.1% in October 2020.
23 March 2020: Australia goes into lockdown
In light of the worsening pandemic, Australians were sent into a lockdown with offices and schools closed and everyone under stay-at-home restrictions. The restrictions varied by state with New South Wales and Queensland emerging from lockdown on 1 May although many restrictions on socialising remain in place, even in December.
After sharp dives at the beginning of March, the ASX 200 regained 15% during the lockdown period.
July 2020: Unemployment reaches 20-year high
With travel and social distancing restrictions enforced as a result of the pandemic, thousands of people lost their jobs or were furloughed causing the unemployment to rise from 5.1% in February to 7.5% in July. Biggest losses were seen in the hospitality, arts and accommodation sectors. However, expectations that it would reach as high as 10% were unfounded.
7 July 2020: Victoria enters second lockdown
With most states returning to some semblance of normality, it was bad news for Victoria after a flawed hotel quarantine process meant they had to return to lockdown for a second time. The lockdown, which was regarded as one of the most severe in the world, lasted until 28 October, a 112-day stretch.
AUTHOR
Laura Dew
Recommended for you
Bell Financial Group has appointed a chief investment officer who joins the firm from Clime Investment Management.
Private markets funds with “unattractive practices” could find themselves facing enforcement activity with ASIC chair Joe Longo stating he cannot rule it out in the future.
Despite ASIC concerns about private credit funds being accessed via the advised channel, there are questions regarding how high its usage actually is among financial advisers.
Challenger has looked to the superannuation industry for its appointment of a group chief investment officer, a newly-created role.
